Regulators apparently have delivered on their promise of greater “speed to market,” and the System for Electronic Rate and Form Filing (SERFF) appears to have fulfilled the mission established by its proponents.

Filing specialists at AAIS and other organizations report that they have seen a dramatic increase in the speed with which rate and form filings are processed and approved since SERFF became fully functional. (AAIS became the first national advisory organization to submit filings through SERFF in 2004.)

“We’ve seen a real increase in the speed of approvals since we’ve been submitting through SERFF,” says Larris Larsen, AAIS assistant vice president for compliance. “Approvals that once took 60-90 days now take 2-3 days. The difference is huge.”

“We had one state approve a filing in 20 minutes,” adds Laura Lemke, senior filings and compliance specialist.

Others in the industry offer similar observations.

“Turn-around time has improved greatly,” says Rebecca Ritchey, research and development specialist for Preferred Mutual Ins. Co., New Berlin, N.Y. Some “95% of our filings are approved in half the time they were before.”

Automation

Larsen and others cite automation as the biggest reason for more rapid approvals, because of the efficiency automation creates and for the way in which it structures the process.

For example, AAIS uses the “Tracker” application developed by InSystems Corporation, Markham, Ont., to submit filings.

Tracker incorporates filing criteria of individual states into the SERFF platform developed under sponsorship of the National Association of Insurance Commissioners (NAIC).

Tracker and SERFF facilitate faster filings by requiring users to fill in all essential forms and fields, says Larsen.

“There’s very little back and forth on basic fulfillment anymore,” he says. “You have to fill it all out, or it won’t ‘Send’.”

“The nature of SERFF’s design dictates that states follow mostly uniform procedures,” says Justin Brady, manager of government and industry services for FM Global, Johnston, R.I. Brady adds, however, that standardization has led to an increase in the number of filing criteria in some states.

Mary Jo Shields, senior analyst for regulatory compliance with Jewelers Mutual Ins. Co., Neenah, Wis., recalls that, years ago, a company might not be aware of changes in a state’s filing procedures until a filing was submitted and had to be modified.

“Congressional pressure on the NAIC resulted in the NAIC standing behind SERFF and its standardized filing requirements,” Bieniek adds.

Changing work

Like professionals in other fields where automation has been introduced, insurance filings and compliance professionals are seeing the nature of their work transformed.

“The filer today is more productive than a few years ago,” says Bieniek. “Most companies we do business with have told us they still have the same number of filers as in the past, but are producing more filings.”

That’s certainly true at AAIS where, according to Larsen, “We’re doing far more filings with the same number of people.”

At AAIS today, most of the filing submission activity can be handled by one member of the AAIS filings team, leaving Lemke and others time to pursue other initiatives on behalf of AAIS member companies.

One filings specialist is completing a project that will provide users of AAISdirect with easy access to consolidated information on AAIS form filing numbers, their effective dates, and their corresponding state filing numbers.

For the meantime, Lemke is creating a database that will provide AAISdirect users with direct access to the most current information on company action needed to adopt a form.

(Currently, bulletins announcing approvals describe the company action needed at that time to adopt a form. If a company waits to adopt a form, it has had to determine if there has been a change in the action needed to do so. That information will be available automatically to users of AAISdirect.)

Companies, too

Company filings specialists find that there are new expectations being place on them.

“Preferred Mutual is asking us to do more market studies,” says Ritchey. “It’s asking us to find information on how the market is changing and the industry is changing.”

In a 2004 article, Penny Kilberry, assistant vice president for regulatory compliance for Monitor Liability Managers, Rolling Meadows, Ill., identified six emerging or growing areas of responsibility for compliance professionals, in addition to product submission and approval:

• Internal audits for market conduct;

• Coordination of market conduct examinations;

• Handling of customer complaints;

• Communication of compliance information to noncompliance staff; and

• Adherence to federal directives.

“As the emphasis of the compliance function has shifted in response to the changing regulatory environment, its importance to the successful operation of the company has grown,” wrote Kilberry, now national secretary for the Association of Insurance Compiance Professionals (AICP).

“Top management of most companies has become increasingly aware of the impact of compliance operations on the bottom line,” she continued.

Complexity

It would be wrong, however, to conclude that filing work has been “simplified,” and that compliance professionals are essentially looking for new roles.

With new capabilities for executing filings come increased demands for more information in them.

“Filers have more effective resources available, [but] demands on the filer have increased as well,” says Bieniek. “Insurance departments and legislatures have increased the requirements for supporting documentation for many filings.”

“Increased marketplace competition is another factor causing insurers to develop rating or form revisions, thereby necessitating more filings.”

Brady at FM Global adds that “more state insurance departments and legislatures are demanding more statistics in greater detail. It is a challenge for insurers to respond promptly.”

Also, filings professionals are still learning how to maintain the human touch in a regulatory process transformed by automation, says Lemke at AAIS.

“Building rapport with individual analysts is a little more difficult now, because we don’t talk to them as much as we used to,” she says.