Annexure Deck to Final Report Out_07.27.12_V3.ppt

Annexure Deck

2. 2
Project Methodology & Sample Deliverables

3. 3
Process Improvements –Policy Administration
Easy to Implement
Highly Critical
Less Critical
Difficult to Implement
Systems
1.Resolve issues with copy pasting / typing large
manuscripts to eSurplus
2.Upgrade eDelivery option to include more than one
email address
3.Invoice generated from eSurplus to be separated from
coding details to enable eDelivered
4.Integrate of SAP (A/cing system) with eSurplus / PPSi /
PPS
Systems
1.Remove isolated systems in use e.g. TRAP to send
invoices in CA
People
1.Implement data centric performance metrics for UAs / UTs
2.Ensure upload of all manually processed documents to
ePRS / Docushare
3.Reinforce use of Salesforce
4.Formal training plans for new UAs / UTs and monitoring
of progress
Systems
1.Remove WTS reporting mechanism and ensure iSuite
reporting functionality is relevant from a performance
measurement perspective
2.Renewal identification reports to be generated from
systems and centralized
People
1.Feedback to some locations to stop sending out hard
copy policies to the brokers unless absolutely required
Systems
1.Automate generation of Policy numbers from the
systems, currently a manual process
2.Streamline Physician Credentialing process for Div.
97

4. 4
Key Findings / Process Improvements –Policy Administration
Division Current State Finding Impact Recommendation Benefit
All
divisions
The text of a big manuscript cannot
be copied and pasted or typed in
eSurplus without significant
formatting errors.
Manuscript form (Word document)
needs to be attached manually
Policy cannot be eDelivered if
manuscripts form has been
attached.
Significant additional effort -
Policy document is printed,
scanned and emailed to the
Broker
eSurplusshould be upgraded to
accommodate any size
manuscripts without formatting
errors. Change to be
implemented across all divisions
Policies can be
eDelivered reducing
manual effort
UAs don’t need to
update ePRS separately,
for manuscripts processed
through eSurplus,
All
divisions
Lack offormaland documented
performancemetrics for UAs / UTs
Difficult to measure
performance objectively
Create detailed measurements
baselined on actual data from
systems (like eSurplus / PPSi /
iSuite)*
Brings accountability to
processing
Objective Performance
metric
Increased motivation
All
divisions
WTS is updated manually forthe
most partby the UAs / UTs and is
generally viewed as redundantat
the field office level. Not being used
by the Supervisors to track
performance
‘Non ValueAdd’ activity that
adds time to processing.
Consider phasing out WTSpost
iSuite implementation. Ensure
iSuite reporting functionality is
relevant at the Supervisor level
and key performance related
data points automatically filled in
from eSurplus / PPSi
Eliminate manual step
Increase the validity of
the performance report
All
divisions
eDeliverycurrently sent only to one
Broker ‘s email address
The Producing broker may not
be involved in administrative
tasks and maynotkeep track
of the issuance
Provision should bemade within
eDeliveryto send emails to
multiple email addresses if
required, including Broker’s
admin personnel
Reduced follow ups by
brokers
All
division
Sales forcenot being used
consistently
IncompleteSalesforce data Top management to reiterate
the importance of using
Salesforce frequently
Ensures completeness
of data in Sales force

5. 5
Key Findings / Process Improvements –Policy Administration
Division Current State Finding Impact Recommendation Benefit
Div 91 Endorsements processed manually
(using Wordtemplates) are not
uploadedontoDocushare consistently
Incompletepolicy
documentation in
Docushare
Allmidtermendorsements
shouldbyuploadedonto
Docushare
Ensures completeness of
Policy documentation
Div 92&
93
After bookingof Premium, Invoice from
eSurplus is generated with coding
details hence cannot be eDelivered.
This is not an issue when Invoice is
generated for an endorsement, hence
can be eDelivered with the actual
endorsement
UAscurrently print the
Invoice, separate the
coding details page, scan
and email the Invoice to
the Brokers
EnhanceeSurplus to
separate Invoice from
Codingdetails page
eDeliver all Invoices
Increase productivity of the
UAs
Div 92 Some offices still Mail out polices to the
Brokers (e.g. Chicago and SFO)
Increased printing and
postage cost, manual
process leading to less
productivity of the UAs /
UTs
Mailing of Policy
documentation should be
done under exceptional
circumstances post
approval from a manager
Further reduce Postage /
Printing cost
eDelivery ensures archiving of
final version of the policy in
ePRS automatically
Div92 &
93 (CA)
TRAP database is used to generate
Invoicesfor ‘Non California’ policies
instead of eSurplus
Inconsistency across
regions
Use eSurplus to issue
Invoice for ‘Non California’
policies
Consistency across the
Division
Accuracy of the Invoice
All
divisions
Invoices have to be handed over /
mailed to Accountingdepartment
Manual process / Can
lead to delaysor revenue
leakage
Better integration of SAP
with eSurplus / PPSi/ PPS
or other corporate systems
beingfed by eSurplus /
PPSi or PPS
Reduce manual effort on the
part of UAs / UTs
Reduce risk of leakage
Div 97 Physician Credentialing process is
cumbersomeand time consuming
Decreasedproductivity of
Retained UTs
Indepth process analysis
should be done to
streamlinethe process.
Look at the option of
including it with Broker
Services
Standardize response to
‘Physician Credentialing ‘
request received from Brokers
Increase productivity of
Retained UA

6. 6
Key Findings / Process Improvements –Policy Administration
Division Current State Finding Impact Recommendation Benefit
All
Divisions
There are a number of frequently used
forms that are missing / outdated in
eSurplus
These forms need to be
processed outside of
eSurplusrequiring
additional effort. Policy
cannot be eDelivered
A detailed review of forms
that can be included in
eSurplusneeds to be done.
Thiswill ensure that policy
issuance and delivery can
be completed from the
system for more policies.
Policies can be eDelivered
reducing manual effort
UAs don’t need to update
ePRSseparately, for
manuscripts processed through
eSurplus
All
Divisions
New UA’s / UT’s aregenerally provided
limited on the job training by senior
UAs
Inconsistent / practices
followed across offices
Formal training plans and
mandatory curriculums
designed by Home Office to
ensure consistency of
learning. Progress should
also be formally monitored
Consistent implementation of
procedures across all offices
Across
Divisions
eSurplus / PPSi don’t generate policy
numbers. Policy numbers are allotted
from Corporate office and maintained in
manual logs. UA / UT earmarks policy
number that are used
Risk of duplication of
Policy number. Also adds
to manual effort
Automate generation of
Policy numbers from the
systems
Eliminate risk of duplication of
policy number
Reduce manual effort
All
Divisions
UpcomingRenewals are identified at
the individual UA / UT level using
manually maintainedlogs / dairies
Duplicationof effort since
systems reports can be
run to identify the policies
coming up for renewal
Make system reports(like
CRUIS) available to all UA /
UTs. Fix all issues with
system reports to ensure
accuracy of the reports
Reduce manual effort of
maintaining the logs / diaries
Reduce risk of a missed
renewal

7. 7
Key Findings / Process Improvements –Surplus Lines Filings
Division Current State Finding Impact Recommendation Benefit
Across
Divisions
A large % of UAs / UTs not using
documentedchecklist / guidelines created by
Surplus Lines Compliance department. A lot
of the UAs/ UTs were not mapped to the
Compliance share drive
Following wrong or
outdated procedures
leading to rework post
rejection by
Compliance
Creationof a Surplus Lines
Center of Excellence with
specialist ensuring compliance
to guidelines
Better compliance to state
regulations. Potential
reduction in State audit
fines
Across
Divisions
We found instances of UAsusing UW’s
electronic signatures on Home State
questionnaire form without the UW
necessarily reviewing the form
Incorrect
determination of
HomeState for filing
UWs be educated to filling out
the Home State questionnaire
based on approved guidelines
and in collaboration with the
Broker
Correct determination of
Home state for filing
Across
Divisions
Alot of UAs use incorrect Broker license
numbers just to get the booking done within
timelines . Most don’t update eSurplus / PPS
post receiving the Broker Responsible
Agreement form
Company records /
system data don’t
match filings done by
Brokers with the State
Surplus Lines Center of
Excellence review Bookings
done with Broker Responsible
Agreement forms obtained
Ensure system data
matches filings done by the
Brokers
Avoid potential fines by
the State
Across
Divisions
There are instances of policy documentation
being updated post rejects by the Compliance
team.Updated documents are not always
sent to the Broker
Inconsistency
between documents
filed with the State
and sent to theBroker
Surplus Lines Center of
Excellence to ensure updated
documentation is sent to the
Broker
Ensure no mismatch
exists between
documentation sent to the
state and to the broker
leading to audit issues
Across
Divisions
SLFS currently generate the Invoice (for
Agency responsible policies) with an added
‘Missing documents’ page. Some UAsdon’t
remove the ‘Missing documents’ page when
sending the Invoice to Brokers
May lead toconfusion
at the Broker’s end
The Invoice tobegenerated as
a separate document in SLFS
to avoid manual steps like
printing, separation of ‘Missing
documents’ page, scanning
and then sending to the broker
Remove manual steps
Avoid confusion at the
Broker’s end
Across
Divisions
Wecame across instances of Surplus Lines
forms being corrected by the UAs themselves
without referring back to the Brokers who
signed the document . This was done post
rejection by Compliance team.
Can lead to severe
State audit penalties if
discovered
Surplus Lines Center of
Excellence to be responsible to
contact brokers, explain the
requirement and get corrected
versionof the form
Avoid violating any state
regulations

8. 8
Understand end to end
current state process
Decompose current state
process into detailed level
tasks, understand UA-UW
handoffs
Map current state process
Identify location wise
variations
Project Methodology
Identify core –non core
activities, complexity &
efficiency of decoupling
Build workflow and handoffs
Define task level
responsibilities for future state
players –UW, UT and Shared
Service Centre UAs
Understand regulatory
requirements
Map the skill requirements
Understand key enablers for
migration
Recommend migration plan
Timelines
Migration Structure
Identify:
One time cost factors
Steady state savings
Analyze various risks and
complexities
Define As-Is Process Design Future Operations Implementation Plan
Propose End State with
Business Case
SIPOC
Current state process map
Documented location wise
variance –current state
Process improvement
areas
Retained functions
Consolidated functions
Future State process
flow
Estimated required FTE
Location options for
consolidation
High level migration strategy
Cost Benefit Analysis
Risks and Mitigations
Identify Key next steps
Approach
Output
Interviews with SME’s
Interviews with process
owners
Existing information on
systems, processes
Activity Analysis -criticality
and efficiency of
decoupling
iSuite workflow documents
Best practices
Volumes data by systems –
eSurplus, PPS, CRUIS & SLFS
Touch time estimations by SME’s
and validation by process owners
Skill set availability
Migration considerations
Sending and Receiving costs
One Time costs assumptions
Best practices
Input

9. 9
‘To Be’ Process Flow –Policy Administration
Future state process maps were developed based on detailed understanding of the sub processes, optimal activity split,
workflow under implementation (iSuite) and identified improvement areas. We also leveraged best practices and considered
improvement areas that exist in the xyz divisions that currently use the Shared Services Center(s)

10. 10
Understand end to end
current state process
Decompose current state
process into detailed level
tasks, understand UA-UW
handoffs
Map current state process
Identify location wise
variations
Project Methodology
Identify core –non core
activities, complexity &
efficiency of decoupling
Build workflow and handoffs
Define task level
responsibilities for future state
players –UW, UT and Shared
Service Centre UAs
Understand regulatory
requirements
Map the skill requirements
Understand key enablers for
migration
Recommend migration plan
Timelines
Migration Structure
Identify:
One time cost factors
Steady state savings
Analyze various risks and
complexities
Define As-Is Process Design Future Operations Implementation Plan
Propose End State with
Business Case
SIPOC
Current state process map
Documented location wise
variance –current state
Process Improvement
areas
Retained functions
Consolidated functions
Future State process flow
Estimated required FTE
Location options for
consolidation
High level migration
strategy
Cost Benefit Analysis
Risks and Mitigations
Identify Key next steps
Approach
Output
Interviews with SME’s
Interviews with process
owners
Existing information on
systems, processes
Activity Analysis -criticality
and efficiency of
decoupling
iSuite workflow documents
Best practices
Volumes data by systems –
eSurplus, PPS, CRUIS & SLFS
Touch time estimations by SME’s
and validation by process owners
Skill set availability
Migration considerations
Sending and Receiving costs
One Time costs assumptions
Best practices
Input
See Final Report
Out Deck

11. 11
FTE Analysis –Assumptions for calculation
Future expected growth in the divisions has not been factored in to calculate the proposed FTE numbers
No seasonality has been factored in as the fluctuations are manageable with the additional factors given to the UTs / SSCs. Some
seasonality is known to occur due to Jan and July renewals
Estimations and target operating model has been based on information received from the locations interviewed. This information
was then extrapolated to other locations for those divisions
As Is FTE, Estimated Service Centre FTE and Retained UT numbers are based on time estimates received during interviews with
UAs . Minor adjustments were made to account for % of manuscripts, RI , multiple locations and underlying policies that a division
may process relative to others
An additional factor of 10% was given to the current state UAs to account for other tasks like any report, premium audit, claims
inquiries etc.
For the future state, Retained UTs have been given an additional factor based on our discussion during the 2
nd
set of
interviews to account for other tasks as well as on the job trainings to enable them to graduate to underwriting functions (Please
refer slide # 40 -48)
SSC UAs have been given a additional factor of 10% to account for other tasks/reports/coaching etc
All calculations are based on a 6.5 hour productive day and 220 working days in a year
Seamless Implementation of iSuite –Future state estimates have been done assuming complete implementation of all
functionalities mentioned in the iSuite Business Requirements document
iSuite implementation should render the retained UT’s physical location irrelevant. iSuite will enable the UT’s to support other
locations

12. 12
‘As Is’ FTE Analysis –Div. 91, 92, 93 & 97
Detailed analysis has been done division and location wise to estimate the total required FTEs and to understand effect of
fragmented locations on excess capacity
FTEs directly attributable to fragmented locations
‘As Is’ required FTE vs. Total Excess Capacity
Analysis below includes ‘As Is’ Surplus Lines Filings; does not include Div. 25
% Distribution of Excess Capacity over divisions
90
55
7
As Is' FTEs required for
Policy Admin
Excess Capacity
As Is' FTEs required for
Surplus Lines filing
13
42
Due to
Fragmentation
Other Excess
Capacity
11%
45%
38%
5%
Div. 91
Div. 92
Div. 93
Div. 97

13. 13
‘As Is’ Location Analysis –Div. 91, 92, 93 & 97
Total Headcount on LocationRequired FTEs Excess Capacity
24
18
17 *
11
7
11
8 8
7 7
* Boston includes National Branch & Home Office (Boston)
Top 10 locations by headcount
15
11
3
5 5
4
1
4
3
4
9
7
14
6 6
4
7 3
4
3
0
5
10
15
20
25
30
New York Chicago Boston *Los Angeles San
Francisco
Atlanta Montreal Dallas HoustonPhiladelphia

14. 14
Understand end to end
current state process
Decompose current state
process into detailed level
tasks, understand UA-UW
handoffs
Map current state process
Identify location wise
variations
Project Methodology
Identify core –non core
activities, complexity &
efficiency of decoupling
Build workflow and handoffs
Define task level
responsibilities for future state
players –UW, UT and Shared
Service Centre UAs
Understand regulatory
requirements
Map the skill requirements
Understand key enablers for
migration
Recommend migration plan
Timelines
Migration Structure
Identify:
One time cost factors
Steady state savings
Analyze various risks and
complexities
Define As-Is Process Design Future Operations Implementation Plan
Propose End State with
Business Case
SIPOC
Current state process map
Documented location wise
variance –current state
Process Improvement
areas
Retained functions
Consolidated functions
Future State process flow
Estimated required FTE
Location options for
consolidation
High level migration strategy
Cost Benefit Analysis
Risks and Mitigations
Identify Key next steps
Approach
Output
Interviews with SME’s
Interviews with process
owners
Existing information on
systems, processes
Activity Analysis -criticality
and efficiency of
decoupling
iSuite workflow documents
Best practices
Volumes data by systems –
eSurplus, PPS, CRUIS & SLFS
Touch time estimations by SME’s
and validation by process owners
Skill set availability
Migration considerations
Sending and Receiving costs
One Time costs assumptions
Best practices
Input
See Final Report
Out Deck

15. 15
Cost Benefit Analysis –Surplus Lines Filings
Transition to Olathe
CALCULATION Amount (in $)
A)CURRENT STATE COST -Recurring
CurrentCost UAs / UTs 1,026,446
Sub Total 1,026,446
B) FUTURE STATE COST -Recurring
Costof Retained UTs 0
Cost of Service Center UAs 910,000
Sub Total 910,000
C)ONE TIME TRANSITIONCOST
Severance Cost of UAs / UTs released 360,764
MigrationCost (Knowledge Transfer + Parallel Processing) 85,200
ParallelOperations Cost 78,957
Sub Total 524,921
COSTBENEFIT YEAR 1 (A-B-C) TOTAL -408,475
COSTBENEFIT YEAR 2 (see spreadsheet) 161,946
COSTBENEFIT YEAR 3 (see spreadsheet) 161,946
COSTBENEFIT YEAR 4 (see spreadsheet) 205,171
COSTBENEFIT YEAR 5 (see spreadsheet) 205,171
NPV 126,472
Break Even Year Year 2
Potential reduction in late fines / penalties from the states of Texas and California = $652, 159 (Estimate based on 2011 data)

16. 16
CBA –Assumptions for calculation
No tax rate for CTOM has been assumed/baked in
5% productivity gain is assumed for Year 2 and 4. This being the benefit or incremental productivity gain in a shared service
environment
No pay rise or any other inflationary index has been baked in over the years
The following rate card has been assumed for the migrations cost
Training durations for filings –3 Weeks, Parallel Processing –12 Weeks to cover for all 4 waves
Severance Pay estimate for Filings has been taken as the average for the entire Lex Division
The CBA is done at a division level since it cant be deciphered at this point of time about the retained UA and their location
Training time (in weeks) were arrived at based on our assumptions that a minimum of these curriculum items will be included:
 Insurance, P&C and Surplus lines overview
 Cultural training (if CTOM)
 Process Training (New Business, Renewals, Endorsements)
 Systems (iSuite, eSurplus, PPS, GAIN, eDelivery)
 Exception scenario discussion
 Final Certification for Go Live
Component Price Assumption
Flight Tickets -International $5,000.00 Per round trip (business class)
Flight Tickets -Domestic $1,000.00 Per round trip
Accommodation $1,500.00 per week per person
Per Diem per Day $200.00 per day per person
Visa / Insurance $300.00 per person
Taxi Fare $100.00 per day per person

17. 17
Canada -Recommendations

18. 18
Canada Div. 66 –‘As Is’ Process / Team Structure
Additionally UA Responsibilities
Monthly and quarterly reports prepared manually –Rate Monitoring report, CAT Reports, BI & I report and Limits of Liability report
Update Account Summary tab of the Rating workbook for some programs
Responding to claims team’s request for policy documentation
Addressing queries from accounting team –typically to resolve discrepancies between amounts booked and amount received
from Brokers
Update eStart status post booking
Team structure
Mike Stinson, VP
(Programs, Div. 66)
2 Underwriters
(Div.66)
2 Underwriting
Assistants
(Div.66)
1 Underwriting
Assistant
(Auto div.)
An additional UA from Auto
division currently spends
approximately 80% of her time
working on Div. 66 policies
In Scope FTEs –2.80

19. 19
Canada Div. 66 -Future State Responsibility
Shared Service Center activities Fieldoffice UA responsibility
Booking ofPremium in PPS Complete pre defined sectionsof all Rating Workbooks
Reserving of Submission in eStart Generate Quotes / Binders post UW approval for simpler programs
“Quote Prep” activities like running Loss run, EMIS & D&B Monthly and quarterly reports currently prepared manually (but should be more automated)
Update Account Summary tab of the Rating workbook
Responding to claims team’s request for policy documentation
Resolving Accounting team’s queries
ReviewBookings done by Shared Service Center –through CRUIS reports
Coordinate with Shared Service Center to get reservation / “QuotePrep” activities done
UAs to update monthly ‘bordereaux’ / spreadsheet from Brokers with all required information and
forward to SSC via email / iSuite to code into PPS (applicable for Category 2)
Order Inspection/ Marshal and Swift valuations
Recommended Future State Responsibility Chart

20. 20
Additional UT Activities and Updates Made to the Original Model

21. 21
Original Model –Additional Information
1)“Future State” activities are based on 1st set of interviews, iSuite Business Requirement document and process
improvement recommendations (Referred Future State is the end state post iSuite implementation and post consolidation).
Activities were segregated between Shared Service Center and Retained UTs in field offices
2)Each activity was assigned transaction time estimates as obtained during the 1st set of interviews. Activities and
corresponding time estimates rolled into a consolidated time estimate for 4 transaction types: New Business, Renewals,
Endorsements and Cancellation
3)Consolidated time estimates were multiplied with corresponding volumes by transaction type to arrive at preliminary
requited FTE number. (see ‘A’ in the slide above) This was done at a division –location level.

22. 22
Updates to Original Model post 2
nd
Set of Interviews –Div. 93
Reservation–Provide required
information to SSC for reservation,
following up with blocking
underwriter and updating eStart
status
Coordinated with SSC –
Prepare Booking / Issuance
(Policies & Endorsements) hand off
templates, Review and approve
Booking / Draft policies
Loss Control –Order Loss
control / Engineering reports
Follow up with Brokers –For
subjectives, underlying policies /
binders, payment, clarifications,
etc.
Use EMIS to identify cross sell opportunities
Work with UW and respond to Scrub report
Request HSB for Boiler quote –if over 100 mil.
Check HSB binder to make sure its in line with
Lex Binder
One UA in the team does P&L analysis
Complete and send template if separate
Canadian policy needs to be issued / booked
Reconcile HSB discrepancies
Senior UT does 6 broker calls a year
Training for new UTs
UA populates eRe (ad hoc basis)
Key in basic information in PPT (ad hoc basis)
Request CAT Model on an ad hoc basis
Productivity
Loss /
Leakage
Retained UT activities already included in the
original model
“Other activities” identified in new interviews
A) Volumes * Time estimate
(received during our interviews)
C) 35% time of 50% of the current UA population D) 10 % of
‘A’ + ‘B’ + ‘C’
Marshal
and Swift
valuations
done for top
10 locations
(for all
accounts)
B) Volumes
(NB +
Renewal) *
45 mins. (per
interviews)
12.66 FTE 10.00 FTE
2.77 FTE
3.13 FTE
Premium
Audit
Prepare draft
manuscripts
Prepare
standard Rating
workbook
1.90 FTE
1.26 FTE -
original model
1.51 FTE -
incremental change
30.46 FTE (Rounded to 31 FTE)
Generic activity Ad hoc activity

23. 23
Walk –Original FTEs to Updated FTEs (Div. 91,92,93 & 97)
Div. Original Model
(RequiredUTs in field office)
Add: Updatesbased on
new interviews
New ModelTotal
(RequiredUTs in field office)
Delta
“Core”
activities
“Other”
activities
Leak
-age
Total Round
-ed
“Core”
activities
“Other”
activities
Leak
-age
“Core”
activities
“Other”
activities
Leakage Total Rounded
91
0.91 0.14 0.09 1.14 2 - 0.76 0.09 0.91 0.90 0.18 1.99 2 0
92
11.78 1.77 1.1814.72 15 - 4.03 0.58 11.78 5.80 1.76 19.34 20 5
93
12.66 1.90 1.2615.82 16 3.13 10.00 1.51 15.97 11.90 2.77 30.46 31 15
97
4.60 0.69 0.46 5.75 6 - 1.01 0.17 4.60 1.70 0.63 6.93 7 1
39 60 21
Updates to the Original model were made to account for additional activities done by the UAs / UTs in the field offices. These
activities were identified during the 2nd set of interviews. Walk below shows the change in the FTE numbers post the update for
UTs to be Retained in field offices in the “Future state”

24. 24
Required Skill Sets –Shared Service Center