Universal Life & Annuity Insurance Industry – A Form Driven Business
Spotlight Issue 1 – 2012
ACORD Standard “eLabels” – Why you should be interested and how your company can leverage this exciting standard offering.
The ACORD standards have primarily been leveraged by the back office of the insurance industry supporting business transactions both in to and out of the data center. This machine to machine standardized messaging is extremely important to the insurance industry and enables tremendous re-use flexibility while delivering real cost savings.
The life and annuity insurance industry is extensively a form driven business. There are examples where forms have been eliminated in new business, but these are the exceptions. In many business cases forms with a signature continue to be required by regulation or by the compliance department. The support of e-signature presents the opportunity for the industry to go completely electronic, with the actual
state regulated forms continuing to be a major part of insurance business processing.
Proprietary forms are a reality of the life and annuity insurance business; they are unique to each insurance provider and distributor and are very specific to the product type and flavor of each product. Proprietary forms are also viewed as a competitive marketing tool in the industry. Even with the move to a completely electronic system, forms will remain in the life and annuity industry for the foreseeable future. So how can they be made more usable in electronic processing?
What are ACORD eLabels?
ACORD eLabels are widely used within the Property & Casualty industry along with the use of ACORD eForms. They are used within an electronic form to provide standardized XML data tags providing consistency in the input and extraction of data to and from forms. ACORD developed the eLabels by following stringent Naming and Design Rules to establish reusable “tags” that can then be used consistently across all forms and processes. The life and annuity industry is utilizing ACORD eLabels to make form data more accessible and more effective in electronic processing workflows. They bridge the gap between the existing proprietary and unique forms in use today and align form data with the ACORD standardized business messages.
These standardized eLabels are provided to the industry as a library of pre-defined labels. The meaning with each has a documented and defined map to the Life and Annuity XML Standard data elements that it represents, along with the business messages that a form can use; for example, the 103 New Business Transaction. The eLabel standardization effort is not limited to the 103 transaction, which is the first transaction that the eLabels standardization effort is documenting. All other transactions can benefit from these standards as well.
All PDF based insurance forms have the ability to be rendered as a “fillable” PDF. This means the fields on the form can accept data typed into the tag or field when presented using an electronic form reader (i.e., Internet browser). This form filled data then becomes part of the saved PDF file. This technology enables the ability to “fill-in” the fields using the computer. If required, the form can still be printed and mailed to the carrier for manual processing, or electronically signed and submitted. Another option is to build a custom processor that will accept and process the data according to the tags you initially created on the fillable PDF.
The ACORD eLabel library of standardized tags provides pre-defined and agreed upon tags that have defined mapping locations to elements within the ACORD 103 transaction. This same standard opens up the opportunity for the industry to “automagically” generate and maintain, through standards, conformant and industry guaranteed standardized ACORD business transactions, both in to and out of your own proprietary forms.
Let’s take the example of an annuity new business transaction, which originates from a form. Until now, the only available option was to either manually re-key the form data into a system or build customized software to create messages from each proprietary form tag source. Once this data is electronic, the business mapping to and from the ACORD standard or in/out of a proprietary standard can and does occur. However, due to the complexity and verbosity of the proprietary standard, many implementations do not conform to the ever evolving new business message standardization and documentation efforts.
Future of New Business Processing
Now with the introduction of eLabels from ACORD for the representation of a new business (103 transaction), these industry standardized tags can be leveraged to bridge the gap between data collected on forms and the unified creation of the ACORD 103 transaction. Through the use of these standardized eLabels the data mapping for your fillable forms are defined and agreed upon by the industry. All that is needed is a business analyst to determine which of the industry standardized tags to utilize on your fillable forms implementation, and the new business messaging is taken care of by the industry. You would still need to create the 103 transaction from your set of forms, but the analytics is taken care of for you with the
eLabels standard. This guarantees a conformant and industry agreed upon standardized implementation that is re-usable.
Take the example of Insurance Technologies’ FireLight® platform, which is an electronic fulfillment and in-good-order business processing platform. You can take your existing fillable new business PDF forms, load them into a FireLight instance, tag the fields using the ACORD standardized eLabels, and the output would automagically be generated as an ACORD 103 (new business) XML compliant transaction.
These forms can then be offered up to any distribution channel while ensuring the data entered is compliant with ANY in-good-order business rule your product and/or back office may have. FireLight is 100% flexible to meet any demand and works across ALL lines of business. Business rules are fully reflexive so there are no product specifics that cannot be supported. FireLight is flexible to meet the ever changing landscape of future product change and development.
The FireLight platform also has built-in, fully compliant, no-charge electronic signature (an industry first), and two dimensional bar coding for use by your back office to retrieve the actual electronic data on printed and wet signed applications. This eliminates the re-keying of data and continuing supports the way business is done today. The platform can also be introduced with a seamless transition from your ForeSight™ sales illustration implementation system and passes through all data entered, eliminating the need for the representative to re-key data. This platform can be introduced quickly with significant cost savings to meet post issue business transaction processing requirements, as well as integrated workflow following the recent DTCC post issue transaction processing.
Continuing Form Development
The ACORD Forms & Data Mapping working group will be addressing continuing form development needs for life and annuities along with this eLabel initiative. Meetings began in January of 2012. Please contact ACORD if you are interested in participating in this effort.