1:15 pm - 2:00 pm
Afternoon Keynote Address-
The Quality of Information On- and Off-line Jay T. Deragon Executive Director, Quality Insurance Congress

Insurers Must Use Internet to "Create New Value,"
Expert Says

The current system of providing insurance is inadequate and doesn't even meet minimum customer needs, an insurance industry consultant told attendees at A.M. Best Co.'s Information Services Conference Monday.

Jay T. Deragon, executive director of the Quality Insurance Congress and chairman of the Deragon Group, said the industry must learn to use information about its customers to "create new value."

This new value entails the "translation of data into information consumers can use effectively" to help them reduce their insurance costs.

Customers want insurance companies to "translate information into problem resolution," he said, "not just finance the problem."

Mr. Deragon's role at the Quality Insurance Congress is to execute strategic initiatives for leadership of the insurance industry, aimed at bringing the multiple disciplines of the industry together to improve the quality of products and services. The QIC is the first all-industry group to focus on improving the industry from the customer's perspective.

Insurers are in the information business, Mr. Deragon said, adding that "one-third of the nation's health-care costs--$300 billion--is associated with the collecting and processing of information."

He recommended using "data mining" to create value for customers. Despite all of the changes in the insurance world, he said, "fundamentally, nothing has changed for the customer" who still wants the greatest possible benefit at the least cost.

"The system is filled with waste and inefficiency," Mr. Deragon said, "and the consumer is screaming for change."

The challenge for insurers, he said, is to "identify the vital few processes that create value for the customer" and to focus resources on those processes.