Picture a scenario where a general contractor (GC), working with their broker, reviews subcontractors' insurance via certificates before hiring for jobs (certificate tracking). The goal is to ensure the risk of property or bodily injury damage is minimized and transferred to the subcontractor for mistakes that occur due to their own work. The certificate tracking process is completed manually using emails and spreadsheets for reference. Both the GC and broker want to pull their hair out with all the emails and threads with attached documents. Reviews are completed, but then the question comes: How many of our subcontractors are properly insured, and how many are on jobsites right now without proper insurance? How strong are our certificate reviews? How much is this process helping us? The room fills with crickets; no one really knows.
Believe it or not, this scenario is all too familiar in the risk management
space. It is no secret that the industry has been slow to move when it comes to tech
advancement, but the ball is now rolling, which means your competitors are leveraging
software that makes them quicker, cheaper, and more dependable. Keeping up with
processes can be burdensome, and the paper trail in this industry can be quite large and
get away from you, but in the end, if you look to mitigate risk and you have no
reference in relation to the positive impact your work is making, how effective are your
efforts really? Is there anything you are missing in your processes? These kinds of
questions become very hard to answer when your data and your work are not structured,
easy to reference, and efficient. Fortunately, in today's day and age, technology can
really solve a lot of these problems and not at the hefty "big-company" price tag it
once was.
Using technology has not only become accessible, but the benefits have greatly
increased with the use of artificial intelligence (AI) and highly configurable systems.
You can find yourself with a powerful, easy-to-use solution that fits your needs at a
low cost. It used to be that only the largest companies could afford to leverage
comprehensive tech offerings (insurers, the largest brokers, the largest contractors,
etc.), and that was for a good reason—old systems had some not-so-palatable issues.
Old legacy systems are expensive to keep running. Some companies
would spend more than two-thirds of their budget on just maintaining systems.
Systems were local, not in the cloud.
Heavy customizations resulted in not-so-flexible solutions.
All-or-nothing adoption. Systems of the past did not communicate well
with one another.
High upfront costs to build a solution.
Long project implementation period.
In the past, technology may have been meant for the big players; however, tech has become much more approachable. New systems now have the following features.
They are cloud-based.
They are often subscription-focused (predictable billing and lower upfront costs to get started).
Such systems are highly configurable off-the-shelf, removing a lot of the need to build custom systems from the ground up.
They are AI-based. AI is leveraged in advanced tools for efficiency gains
and ease of use, such as reading and extracting data from documents and
automatically gathering context for tasks.
They are faster to implement. Moving and implementing to a new system now takes a fraction of the time it did in the past.
New technology typically works well with other systems. Modern systems are built to communicate and share information with other systems via what is called an application programming interface (API).
Changing processes can be daunting, but many of those who have taken the leap have experienced a great plus side.
Less manual data entry into systems is required. Because of APIs and strong
logic, data can prepopulate within your technology, removing administrative burden
where you used to type in data before.
The ongoing costs are feasible, and the upfront costs are often low, reducing the barrier of entry to make the change and continue to use the software.
A system makes fewer errors than humans. Businesses are reducing risk and increasing compliance when it comes to their processes as they are using structured technology instead of unstructured workflows, increasing customer satisfaction while reducing errors and omissions.
Systems often come with public-facing client portals, removing additional
administrative burden, as clients can help themselves immediately.
How to Start Looking for Technology
Reflect on business processes: Where is a painful, repetitive
process occurring? For contractors, is it your prequalification processes?
Certificate tracking? Safety inspections? For brokers, it may be your management of
master policies or perhaps your ability to review and confirm quote and policy terms
and conditions once received from insurers. What is painful about the experience?
Prepare to ask vendors you reach out to how they specifically address these pain
points. Some additional questions to ask include the following.
What is your new client onboarding process like? How do you get from no
system to a system in hand and working? How long does that typically take? Look
for vendors that complement your business goals and time frames.
Ask vendors about system security and integrity. A lot of the data in the
risk management space is sensitive. Choosing a vendor with a high security
standard is paramount to keep your data, your clients' data, and your business
partners' data safe. Look for vendors that point to completed certifications and
attestations such as System and Organization Controls 2 compliance to showcase
their security prowess.
Don't just ask vendors for a demo. In some circumstances, you may be able to
try the solution for free or even conduct a "pilot" test of the system with a
small group of coworkers before committing.
Look for simple, transparent pricing.
Think about implementing the system in phases, not all at once, to help
alleviate a large change in operations. Walk with the software first; do not
run. Look to see how accommodating vendors and their systems are to this.
What is my return on investment? Most vendors can give you an idea of the
financial impact of utilizing their software.
The beginning of this article starts with a scenario of a general
contractor and broker using spreadsheets and emails to perform certificate tracking
operations. In this scenario, the question is not, "Do I buy a technology product to
help me?" but instead, "What is the cost of waiting to utilize technology versus
implementing today?"
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.
Picture a scenario where a general contractor (GC), working with their broker, reviews subcontractors' insurance via certificates before hiring for jobs (certificate tracking). The goal is to ensure the risk of property or bodily injury damage is minimized and transferred to the subcontractor for mistakes that occur due to their own work. The certificate tracking process is completed manually using emails and spreadsheets for reference. Both the GC and broker want to pull their hair out with all the emails and threads with attached documents. Reviews are completed, but then the question comes: How many of our subcontractors are properly insured, and how many are on jobsites right now without proper insurance? How strong are our certificate reviews? How much is this process helping us? The room fills with crickets; no one really knows.
Believe it or not, this scenario is all too familiar in the risk management space. It is no secret that the industry has been slow to move when it comes to tech advancement, but the ball is now rolling, which means your competitors are leveraging software that makes them quicker, cheaper, and more dependable. Keeping up with processes can be burdensome, and the paper trail in this industry can be quite large and get away from you, but in the end, if you look to mitigate risk and you have no reference in relation to the positive impact your work is making, how effective are your efforts really? Is there anything you are missing in your processes? These kinds of questions become very hard to answer when your data and your work are not structured, easy to reference, and efficient. Fortunately, in today's day and age, technology can really solve a lot of these problems and not at the hefty "big-company" price tag it once was.
Using technology has not only become accessible, but the benefits have greatly increased with the use of artificial intelligence (AI) and highly configurable systems. You can find yourself with a powerful, easy-to-use solution that fits your needs at a low cost. It used to be that only the largest companies could afford to leverage comprehensive tech offerings (insurers, the largest brokers, the largest contractors, etc.), and that was for a good reason—old systems had some not-so-palatable issues.
In the past, technology may have been meant for the big players; however, tech has become much more approachable. New systems now have the following features.
Changing processes can be daunting, but many of those who have taken the leap have experienced a great plus side.
How to Start Looking for Technology
Reflect on business processes: Where is a painful, repetitive process occurring? For contractors, is it your prequalification processes? Certificate tracking? Safety inspections? For brokers, it may be your management of master policies or perhaps your ability to review and confirm quote and policy terms and conditions once received from insurers. What is painful about the experience? Prepare to ask vendors you reach out to how they specifically address these pain points. Some additional questions to ask include the following.
The beginning of this article starts with a scenario of a general contractor and broker using spreadsheets and emails to perform certificate tracking operations. In this scenario, the question is not, "Do I buy a technology product to help me?" but instead, "What is the cost of waiting to utilize technology versus implementing today?"
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.