Each month, we will be featuring an “Ask the SMA Expert” article from Strategy Meets Action. This month’s featured question is what we should focus on to convince our compliance management that CCM is a compelling solution answered below by Mark Breading, SMA Partner.
Q: “We are in the process of developing a business case to pursue a new CCM application. Any insights on what we should focus on to convince our compliance management that CCM is a compelling solution for our business?”
Insurance customer documents are subject to a large number of regulations. Everything from legal language and the timing of communications to the fonts and layouts must be checked for compliance. Since regulations are primarily produced at the state level in the US, every insurer must understand and comply with regulations for every state where they do business, for every type of coverage they write and for every type of customer document they deliver. In addition, there is a steady stream of changes to the regulations, numbering in the thousands per year for the average insurer.
Sending non-compliant documents to customers may result in fines, additional rework and even customer-satisfaction issues. New CCM applications can play a major role in helping insurers to address these issues. A modern CCM solution typically has the following features that directly assist in managing compliance, resulting in less manual work and fewer fines for non-compliance:
Multiple departments and individuals may be involved in creating and producing forms, document templates and individual customer documents. In order to ensure compliance, it is vital that only authorized individuals create or change elements that are subject to compliance rules. A modern CCM application will allow for the definitions of specific roles that are assigned to specific individuals. For example, only certain named individuals may be able to change language related to coverage in a given state. The CCM application then “locks-down” this language so that others cannot revise or delete it.
The flow of business results in frequent changes to customer documents or the creation of new customer documents. For example, when a new product is introduced, a new state is entered or a new regulation is issued, existing documents must be revised to create the corresponding new versions. Tracking the different versions of documents that need to be used in each situation is very complex. CCM solutions can automate the tracking of versions.
When role-based authorization capability is combined with version control and reporting capabilities, insurers are able to audit changes. It is critical that audit trails for document changes are available. A modern CCM solution provides this capability, allowing diagnostics to determine what version of a document was used at a particular point in time and who made the changes to the document. There is a lot of value in this for compliance management.
Individuals (or core systems) creating and assembling customer documents cannot possibly know all of the rules on when and where to include the right regulatory language for every situation. A good CCM application can assist in this regard. Rule-based logic can identify when text paragraphs or other regulated components must be inserted, based on the context of the document.
All of these capabilities for the creation and delivery of customer documents allow the compliance group to support other groups that are creating the documents (such as policy servicing or claims) and reduce regulatory fines, manual operations and rework. The automated capabilities of a CCM application enable compliance professionals and compliance management to capitalize on their expertise and knowledge about regulations, while improving their efficiency and effectiveness.
Mark Breading, SMA Partner