1. 1© Copyright 2012 EMC Corporation. All rights reserved.
P&C Claims Automation Solution
A Competitive Advantage
Paragon Solutions, Inc.
Mike Cloutier – Vice President Insurance Markets
ACORD Conference May 15-17, 2012

2. 2© Copyright 2012 EMC Corporation. All rights reserved.
THE COST OF CLAIMS PAYMENTS AND
EXPENSES IS THE SINGLE, LARGEST SPEND
FOR P&C INSURERS, ACCOUNTING FOR
75%-85% OF TOTAL ADMINISTRATIVE COST

3. 3© Copyright 2012 EMC Corporation. All rights reserved.
Top Claims Investment Drivers

4. 4© Copyright 2012 EMC Corporation. All rights reserved.
 Costs
An A.T. Kearney study found that the costs associated with reviewing and settling claims typically
account for up to 65 percent of an insurer’s revenue. Claim handling costs are high because of
process inefficiencies (including manual steps and re-keying) paper use, headcount for expense for
all claim parties and litigation expenses
 Quality
Many insurers have not re-engineered their claims processes; resulting in continued process gaps,
slow processes and poor customer service quality
 Customer Satisfaction
The insurance industry continues to score poorly in customer satisfaction surveys. In a recent
survey of companies conducted by Business Week, only two insurance companies were included in
the top 25 companies identified as “The Customer Service Elite” by the publication. [1]
 Timing
Studies have also shown that customers who receive prompt claims settlements are more likely to
renew with their existing carriers. [2]
[1] Jena McGregor with Frederick F. Jesperson, Megan Tucker and Dean Foust, “Customer Service Champs,” Business Week, 5 March 2007
[2] The American Customer Satisfaction Index, “Scores by Industry: Property & Casualty Insurance,” 2006
Challenges in Claims Processing

5. 5© Copyright 2012 EMC Corporation. All rights reserved.
Other
Departments
Common pain points across claims are costing insurance carriers…
Claims Management Process
…
Invest-
igation
Determin
e
Coverage
Initiate
Claim
Third Party Providers
Financial
Management
 Consistent industry claims leakage of 8-12% of net premiums written
 Limited visibility into trends as well as issues with the accuracy of information contributes
to chronic industry reserve deficiencies
 Loss Adjustment Expense (LAE) inefficiencies are rationalized as required for severity
containment
1. When dealing with 3rd parties…
 Inability to measure performance or value
 Difficulty in selecting and implementing partnerships
2. When managing liability…
 Failure to apply consistent processes to detect fraud and
subrogation opportunities
 Sub-optimal claim handling procedures drive inconsistencies
3. When processing claims…
 Inefficient staffing, processes and organization structure
 Wasted effort and time in claim handling
 Poor customer service permeates process
4. When dealing with other departments…
 Competing incentives from department to department
 Poor integration between claims, underwriting, sales and agency
5. When managing financials…
 Errors with bills and payments
 Unenforced policy limits & deductibles
1
Industry Impact
2
54
*Source: CSFB P&C Primer, Feb 2006; Claims Magazine 20070
3
Business Challenges:
Claims’ Common Pain Points & Impacts

6. 6© Copyright 2012 EMC Corporation. All rights reserved.
Critical Success Factors in Claims
Superior customer
Experience
Improve Customer Satisfaction (higher retention)
 Customer driven state of mind
 Customer access (ex. website)
 Claim communication and facilitation
 Quick claims process cycle time
Coverage
Determination
Loss Adjustment
Expenses
Reduce Operational Expenses
 Focus on increased throughput and reduced overhead
 Performance based on claims throughput productivity
 Reduce specialization to balance loads
Loss
Reduce loss costs
 Indemnity payments
 Eliminate fraud
 Reduce claim leakage
Claim
Resolution
Triage &
Assignment
Investigation
Physical
Damage
Repair
Medical
Management
Litigation
Management
Claim
Evaluation
RecoveryFNOL

7. 7© Copyright 2012 EMC Corporation. All rights reserved.
Documentum
Speed to Value: Case-Based Solutions
Case-based Solution Examples
Customer Care
Contracts
Management
New Account
Opening
Human
Resources
Accounts
Payable
Claims
Management
Configurable
User Interface
Rich
Integration
Capabilities
Model-driven
Configuration
Process &
Content
Unification
Business Process Management
Compliance Monitoring & Reporting
Customer CommunicationsIntelligent Capture
Content Management & Repository Services
Collaboration
Configurable
Dashboards
Role-based
Applications
Reference
Applications
Case Management
Best
Practices
Single platform to rapidly build case-based applications
Solutions up to 50% faster, substantially lower cost
Configuration vs. coding – less resources, complexity & risk
Greater application agility , lower TCO

8. 8© Copyright 2012 EMC Corporation. All rights reserved.
Digital Claims Processing Customer Example
8
Background
 Insurance subsidiary of large US financial institution
 Large writer of property and casualty insurance for
business, home, and auto
 2,800 employees in offices across 32 states
 1,100 employees working from home offices
The Challenge
 Reduce time, effort, and costs associated with
documenting claims
– 18 to 30 days from notification of a loss until claim data
completely entered into the system
 Claims management system data types included:
– 35mm and digital photos, voice depositions, video, claim
forms, police reports, official statements, etc.
 Minimize impact on staff, retain data long-term,
immediate data recovery

9. 9© Copyright 2012 EMC Corporation. All rights reserved.
Digital Claims Processing: An Example
The Results
9
• With this solution, digital images are sent via the Internet
to headquarters, loaded into the EMC Documentum
repository (running with an EMC Centera content
addressed storage system), and then automatically
linked to the virtual claim file—all within 15 minutes
• $2.5 million annual savings
• Reduced claims processing costs by $250,000 in postal
fees alone for the documentation after a recent disaster
• Speeded workflow and provided better access to
information

10. 10© Copyright 2012 EMC Corporation. All rights reserved.
Paragon Solutions’ Profile
Paragon is an enterprise information management
solutions company that helps firms leverage information
assets to achieve better business results.
Corporate Facts
• National Coverage
• Global Clients
• NJ Headquarters
• Dual-shore Development
• CAGR 20+%
• Privately owned, 30-year
history
 Market domain expertise focusing on client solutions
 Solution competencies addressing process
optimization, information management and
information integration.
 Advisory consulting and systems integration teams
delivering business value.
 Industry-aligned accelerator assets providing rapid
time-to-value and lower total cost of ownership.
 A proven delivery track record delivering high value
and return on investment.

11. 11© Copyright 2012 EMC Corporation. All rights reserved.
Contact Paragon for More Information
 Joe Pennino, Solutions Sales Director
phone: 516.610.7024; jpennino@consultparagon.com
 Michael Cloutier, VP Insurance Solutions
phone: 908.783.1903; mcloutier@consultparagon.com

12. 12© Copyright 2012 EMC Corporation. All rights reserved.