James River Insurance builds solid foundation with CGI's INSideOUT insurance solution

James River Insurance Company

James River Insurance builds solid foundation with CGI's INSideOUT insurance solution

"CGI is very flexible and creative with the implementation process for INSideOUT. As a result, James River and CGI built a solid processing system that laid the foundation for this new company and for a solid business partnership."

Bill Kenney, CIO,
James River Insurance Company

In this retrospective, CGI’s INSideOUT solution helps lay the foundation for a new company and a solid business partnership.

James River Insurance Company is an Excess and Surplus Lines insurance company headquartered in Richmond, Virginia. Launched in July 2003, the company is a subsidiary of James River Group, Inc. and has a policyholder surplus of US$57.5 million and direct written premium of US$230 million. Domiciled in Ohio, the insurer operates from its Richmond headquarters and is authorized to write business on a non-admitted basis in a 48 states and the District of Columbia. The company has 13 product lines including General Casualty, Manufacturers and Contractors, Excess and Primary Casualty, Allied Healthcare, Healthcare, Life Science and Professional Liability. James River distributes its products through a limited number of surplus lines brokers and A.M. Best Co. has assigned James river a rating of A-(Excellent).

The Challenge
According to John Clark, Director of Marketing, when James River opened its doors for business in 2003, “The market for most casualty and professional liability lines was in the second half of an all-too-short, hard-market cycle. Like most companies, our overall mission is to deliver consistently high returns on equity to our investors/shareholders by building the most profitable Excess and Surplus lines company in the market.”

The new company built from the ground up with a goal of offering superior products and services to the Excess and Surplus lines market. Its first operational goal was to build a solid policy and claims administration processing system that would be up and running by July 2003. James River wanted a processing system that would provide the flexibility to rate, underwrite, and process highly specialized and hazardous lines of business and to become fast, efficient and flexible.

As a newly established company, James River had the advantage of building its IT infrastructure from scratch. Clark offered, “Another advantage for James River was that as a newly-established entity, it was free of legacy issues that burden many insurers. Legacy issues break down into a number of categories: balance sheets, claim reserves, operational issues like legacy computer systems, old paper files, and entrenched procedures and culture. Not having to deal with any of these issues gave us a tremendous opportunity to build an organization that gives us extraordinary flexibility and control.”

James River also wanted to position its new environment and work flow to be entirely paperless. Its goal—and challenge—was efficiency in order to provide its clients with better service and lower costs, which in turn lowers premiums and enables the company to write more profitable business.

The Strategy
To meet these goals, the solution of choice for James River was INSideOUT, said Bill Kenney, James River’s CIO. “INSideOUT has the competitive edge over other systems primarily because the INSideOUT system is a totally integrated policy, claims and receivables processing system.” James River needed a totally integrated solution to be the core of its company, and it was critical that the system had complete data integrity. Kenney and the Actuarial Department had full confidence that they would be able to produce clean data from the INSideOUT processing system. “Our philosophy from the start of our company was integrity of the data,” asserted Kenney. “The figures that come out of the system at the end of our fiscal year are the figures we use in our Annual Statement; everything balances perfectly. The INSideOUT system made the difference because it is totally integrated.”

CGI, working in tandem with James River, began the implementation in April, and was committed to helping the company get up and running within the prescribed timeframe.

The Technology

• Application Development Environments: Centura Team Developer, Microsoft Visual Studio
• Application Deployment Environment: Oracle, Windows IIS
• Languages: Visual Basic, Smalltalk, SQL Windows
• Technologies: XML, Servlets, Terminal Server, Avaya VOIP

The Results
In keeping with James River’s goal to be operational by July 2003, CGI successfully implemented the full processing system within a 90-day period, helping the company to realize its business plan. “CGI was very flexible and creative with the implementation process for INSideOUT,” remarked Kenney. “As a result, James River and CGI built a solid processing system that laid the foundation for this new company and for a solid business partnership.”

Today, in 2007, James River handles 600 to 800 policy submissions a day and all of the files are processed through INSideOUT’s electronic work flow process, which automates all premium and policy transactions beginning with the electronic applications that come in from brokers and continuing through the life cycle of the policy. “Because the system is table-driven, it is fast, flexible and efficient. It allows us to receive all files from our brokers electronically. We process the quote and download it to the agents’ systems. Once we receive the application, we can typically turn a policy around within 48 hours,” said Kenney. James River processes about 1,000 policies a month and has gone from zero dollars in Direct Written Premium (DWP) to $230 million in a three-year period.

The company’s growth strategy is to increase its lines of business. The fact that INSideOUT is an open database makes it easy to integrate the logic for new product lines and the flexibility of the rate tables makes new and additional rate changes easy to implement. James River’s focus for the future is on new and effective technology and the company looks forward to a long partnership with CGI as the INSideOUT platform moves to .NET.

“The INSideOUT solution adds value to our company because of the flexibility of the tables and the open database architecture. CGI was able to implement the solution and get us up and running very quickly, which was critical to our business. INSideOUT is a totally integrated solution and the positive results are evident. Some providers have part of a solution or components of a policy processing system, but CGI has the whole solution: it is the core of our policy processing,” concluded Kenney.