Footnotes
1 There are state-specific filing requirements that may vary that dictate when a product can be used in the market. For example, a state may have a "prior approval" requirement before a specific form can be introduced into the market; whereas other states might require a "file and use" methodology that permits use in the market prior to approval.
2 A tick sheet is simply a manual tabulation that each contributor utilizes to capture productivity, which can be displayed in an Excel spreadsheet or other comparable output.
3 By "drive-by," I mean someone popping by your office unannounced, grabbing you in the hallway or breakroom, or hijacking a meeting to discuss other matters with you.
4 The sophistication threshold varies by state but can include employee size, revenue volume, the presence of a risk manager, and other variables. If the criteria is met, this may negate the need to perform a rate and/or form filing.
The answer is yes! The main service provided by an internal legal department is legal guidance and counsel. What this exactly means can be somewhat elusive, unclear, and hard to quantify. Internal legal departments are cost centers, funded as part of a company's overhead.
In light of this, it is important for legal departments to be lean, effective, and supportive of the company's profit initiatives. To achieve these goals, here are three simple solutions that are relatively easy to implement: production reports, resource request forms, and document-sharing sites.
Production Report
Depending on the function within a legal department, there are often operational activities that support the business. Looking at legal departments within an insurance company, the legal department (usually a regulatory affairs or compliance function) may have the following responsibilities: form and rate filings, producer and adjuster licensing, marketing/advertisement reviews, legislative monitoring, and data reporting. Each of these areas has unique differences, but there's a commonality in that they are all measurable and quantifiable, and provide evidence to support a legal department's value.
To get started, each department must create a process and select methods to collect and display results. The display needs to be simple, easy to understand, and informative. If sophisticated tools and resources are not available, a simple Excel spreadsheet is all you need. If technology is available, such as SalesForce, then dashboard displays can be utilized, once programmed, to aggregate and display information. Beyond this, the reporting cadence must be decided, which can be weekly, monthly, quarterly, or annually—much will depend on business culture and capacity.
To illustrate the positive impact, consider how every legal department (depending on the size of the insurance company) is responsible for hundreds, if not thousands, of rate and rule filings per annum. Each filing in and of itself is supporting "value" and "profitable growth" to an insurer as it is often necessary to make insurance sales. 1 This information can be easily tallied or monitored, leveraging a variety of methods including creating rudimentary "tick sheets" or extracting information from state filing systems or other in-house technologies, such as SalesForce. 2
Simply tallying up all filings and reporting the same can be a powerful metric to share with the business. In addition, data can be segregated in different manners, as appropriate, to perform further analysis on trends, workflow management, and resource allocations. For example, some filings might range from "easy"—which may mean less than 15 minutes of effort—to the "complex"—which may take over a day to properly execute. Each legal department will have to determine the best method to capture and report data and maximize its utilization.
Resource Request Form
Particularly for in-house lawyers, one of the most challenging parts of the day is to maximize productivity and limit, or eliminate, "drive-by" conversations and requests. 3 Inevitably, every in-house attorney can recall a recent situation in which a "quick drive-by" conversation turned into a 2-hour debacle, which distracted from other priorities. There's an inherent benefit to these drive-bys that may align with corporate culture and accessibility principles, but this must be tempered against competing priorities.
In addition to the frequency of such drive-bys, there can be lost production as pertinent facts are missing that enable an effective legal review. For example, the business person that stops by your office to "run something by you" will likely lack all the pertinent details. The lack of information and facts oftentimes leads to a subsequent meeting, or meetings, to move the issue along. Ensuring the business contact is properly prepared to engage legal counsel is a huge opportunity to drive efficiency.
Creating a simple "request form" that highlights the pertinent detail that is needed for an effective legal review can be invaluable to create an efficient and positive experience. To illustrate, the following is a sample resource request document that we've been using for several years at my organization.
As you can see, the document requires the business contact to capture certain details prior to engaging legal counsel. In return, this ensures the business contact has secured, and thought through, sufficient facts in addition to ensuring the business contact's manager is aware of the request. Financial detail helps illuminate the priority of the request. The result is a more productive "initial" conversation that maximizes productivity and improves the overall experience.
As another consideration, even if it is not required for a business contact to fill out a request form, it might be helpful for the attorney/compliance professional to have it handy to scribe notes. Each department typically requires a series of specific facts that are relevant to most situations that need to be revealed to provide effective legal counsel.
As an ancillary benefit, receiving requests through this formal process helps capture data that can be analyzed and reported. This by-product helps capture legal department value through metrics and analysis. In addition, legal issues have a way of recurring, so capturing research projects and results are informative at a later date.
Document-Sharing Site
Another challenge for the legal department is the time spent on repeat questions. In addition, business individuals MAY become frustrated when they have to secure information from the legal department that is relatively straightforward and clear. An example, for commercial insurance policies, many states permit some form of deregulation, assuming the insured meets a sophistication threshold. 4 In landing new business deals or expanding current relationships, the business contacts may want to know if deregulation is even available in a particular state and the criteria. Not having access to such information, and requiring a conversation or email with legal counsel, can be frustrating, unnecessary, and unproductive.
To solve this problem, the legal department can create a document-sharing site using tools like Box or SharePoint that is accessible by various business contacts and whereby charts and other information can be published. A company's shared drive or a tool within a company's email application can easily serve as a content-sharing site. Microsoft Office, for example, has its own SharePoint site where information can be posted and stored in addition to enabling departments to control access.
As any good legal department will advocate, there needs to be a balance between posting helpful information and ensuring proper legal counsel is provided. A proper disclaimer can be effective in guiding the business users when accessing information and use of the data. Advising the business contact that the information is purely informational and any business action must be brought to the attention of the legal department prior to implementation will help eliminate tempestuous results.
Final Thoughts
Although the main services legal departments provide are legal counsel and guidance, there are several ways a department can improve efficiencies and quantify value. By employing simple, easy-to-implement procedures, it can increase the working relationship with business units and improve efficiencies within the legal department. The by-product of such procedures reveals a treasure trove of data that can be analyzed, segregated, and reported upon.
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