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SEMCI: THE GREAT COMMUNICATOR

Growing numbers of agents demand a universal approach
to agency/company interface

"Current SEMCI offerings can and do address many of the
obstacles that were previously considered difficult to overcome."

By Jim Donaldson, Chief Technology Officer, IVANS

First there was Ronald Reagan, then Bill Clinton, and now there's SEMCI. Whatever the information may be, these great communicators can package it in such a universal way that it travels seamlessly throughout various distribution channels and can be easily understood by diverse audiences. Single entry, multiple company interface (SEMCI) brings this art of communication to the insurance industry.

SEMCI provides a solution to insurance agents looking to improve the way they correspond with their carriers. In an era where information travels at Internet speed, more and more demands are being placed on agents to provide quick, responsive service to customers. To keep pace with the rapid and profound changes within the industry, as well as those within the electronic marketplace, agents are requiring enhanced communication tools to exchange information with their carriers and customers.

SEMCI enables companies and agents to communicate more quickly and easily. Policy transactions, such as new business submissions, endorsements, renewal updates, cancellations, and reinstatements are processed between the agency and the insurance company without duplicate entry. With SEMCI, agents can upload transactions from their desktops directly to carriers' computers, and in turn, insurance companies can download transactions to agency computers. The standardized approach to agency/carrier communication offered by SEMCI enables agents to submit information to multiple carriers without the hassle of moving in and out of their agency management systems.

Despite the length of time the industry has been pursuing SEMCI, it has not yet been widely embraced as the primary, if not exclusive, form of agency/company interface. This may best be explained by the fact that some carriers believe that emerging technologies will eliminate the need for SEMCI or that SEMCI by itself is not sufficient to overcome the obstacles impeding industry efficiency. The answer to these concerns is that new technologies implemented without the benefit of a common user interface yield no benefit over traditional proprietary solutions. Moreover, current SEMCI offerings can and do address many of the obstacles that were previously considered difficult to overcome.

While enhancing communication between agents and carriers is somewhat of a tug-of-war, most companies would agree that SEMCI is beneficial to the industry simply because it makes life easier for agents. With SEMCI, agents can train their customer service representatives (CSRs) much more quickly and efficiently because it eliminates the need to learn multiple programs, log on to multiple applications and enter data for the same transaction multiple times. These efficiencies enhance policyholder service, increase sales and strengthen agency/carrier relationships.

On the other hand, insurance companies are frustrated because they do not see the degree of acceptance by agencies that current SEMCI products warrant. For example, an insurance company may develop a SEMCI system for its agency force of 1,000, but only 200 of those agents are SEMCI-enabled. As a result, companies decide to create proprietary solutions in an effort not to miss out on any "non-SEMCI" opportunities. This helps to explain why agents reported in a recent IVANS survey that less than half of the companies they represent offered SEMCI upload, while the majority offered proprietary interfaces.

SEMCI has not reached its full potential because the required implementation has not yet happened. Not all vendors offer integrated SEMCI technology in their systems. Not all agencies have systems that can support SEMCI. And not all companies are offering SEMCI products to their agents.

However, agency demand for SEMCI is now on the rise due to an increased recognition of the need for more comprehensive and efficient solutions from carriers. One agent attending a recent ACORD conference said he is replacing carriers that are not using SEMCI and won't accept new carriers that do not offer it.

Another agent at the same conference said he gives his personal lines companies three years after accepting an appointment to provide SEMCI or he cancels them. He has already lost one company due to this policy. He also attributed a dramatically lower error rate to SEMCI, noting that fewer errors offer significant advantage because they are difficult to explain to customers, and if not fixed quickly can turn into billing problems, policy re-issuance delays or even E&O exposure.

According to a recent survey conducted by IVANS, "Closing the Agency/Carrier Electronic Communications Gap," only 25% of survey respondents say their agency is conducting SEMCI upload. However, of the 75% who are not conducting SEMCI upload, close to one-third plan to use SEMCI within the next year. These findings illustrate the demand insurance agents will be placing on vendors and carriers to provide uniform agency/carrier communication.

If the industry is to respond to the demand for a universal approach to agency/company interface, i.e., SEMCI, all players--vendors, agents and carriers--must continue to work together. It is only then that all of us will be known as "The Great Communicators." *