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Zywave's broker tools evolve beyond 'gee-whiz presentation'


For one Milwaukee-based company, the information technology and Web-based tools it developed to improve its insurance brokerage business and better serve clients proved so valuable that they ultimately took on a business life of their own.

Zywave Inc. had its genesis in the 1990s in efforts of the Frank F. Haack & Associates Inc. brokerage to develop tools aimed at improving customer service.

"That is the source for our familiarity with the insurance business and our obvious intimacy with the brokerage business," said William R. Haack, Zywave's chairman and chief executive officer.

"I think what was fairly unique is we made some significant investments in our business in terms of being able to do special things for our clients," Mr. Haack said.

Sharing with the competition

Having participated in such broker networks as Assurex Global and Intersure, the Frank Haack brokerage saw opportunities to share some of the tools it was developing with other brokers in the networks.

Beginning to find ways to share some of its online tools with other brokers, in 1995, Zywave--whose name is a play on a graph's X and Y axes and the wave shape that data points often form--emerged as a separate company focused on developing those tools and marketing them to broker partners. Ultimately, in 2004, the company stood truly alone as the Haack brokerage operation was sold to Hilb Rogal & Hobbs Co.

Today, those behind Zywave focus on helping brokers improve their competitive position rather than competing with them for business. The company does so by providing a line of Web-based employee benefit and property/casualty communication, administration, and claims data analysis systems intended to help brokers gain market share and improve their profitability.

The company says the various applications it offers help brokers secure and retain business by differentiating them from their competitors, and allows them to compete with the largest brokers by expanding their range of capabilities.

"I think what sparked people's interest was the success we were having, not only in growing our business, but also in retaining business," said James R. Mueller, president and chief operating officer of Zywave, who joined the Haack brokerage in 1985.

"What we've done successfully is marrying the (business) knowledge with the technology side of the house," Mr. Mueller said. "A lot of people come at it just from the technology point of view and that model hasn't been highly successful."

"Brokers share ideas and concepts and services and so on," said Mr. Haack, adding that the move to form Zywave developed from a combination of thinking that the tools the Haack brokerage was developing might be shared "and, frankly, people asked."

But with the brokerage business becoming ever more challenging, "We didn't realize how difficult it would be," he said. "It's a difficult business."

David M. O'Brien, executive vp at Zywave, said that changes in the brokerage business have made the sorts of tools the company provides more essential to brokers. "In the old days, it used to be about the transaction," he said. Now though, "we need to deliver tools that are quick and efficient and provide higher impact to the client."

And those tools, Zywave suggests, can give brokers a competitive advantage. "We've always promoted transparency: What is your current broker doing for you," said Mr. Mueller.

An 'arsenal of weapons'

Paul S. White, vp, benefits division at Charleston, W.Va.-based Commercial Insurance Services, said trends such as a growing demand for transparency into the value a broker provides the buyer is something he welcomes when armed with the various tools Zywave provides his firm.

"I think because we have some of these tools, I push for that," Mr. White said. He said he wants clients to think about what they're getting for their insurance dollar. Brokers need to find such ways to differentiate themselves in the marketplace, he said, and have an arsenal of weapons with which they can compete.

"There are still guys banging on the door saying it's all about rates," said Elizabeth A. Thorne, client executive at Hylant Group Inc. in Cleveland, another broker utilizing Zywave tools. "Well, it isn't all about rates."

For brokers, the purely transactional world is "the old world that we used to live in," said Gerard J. Lynott, executive vp and benefits practice leader at Hylant Group. "Today's so much more strategic."

Today, Mr. White said, clients are no longer focused solely on rates and the transaction. Instead they want to know, "What are you doing for me the other 365 days a year?" In that context, working with the Web-based analytical and information management tools such as those Zywave provides "allows us to put together five-year plans," he said. "It allows us to answer the questions of the CFO and, more often than not, you've got the CIO in there now."

And Zywave recognizes that the changing climate increases the demands on what it provides its broker clients, according to Mr. O'Brien. Among other things, the company must ensure its broker partners are positioned to make the best possible use of the tools it provides them.

"In the early days it was a lot easier," he said. "You'd just go out there and say, 'We've got Zywave,' and that would get you a broker-of-record letter." Now, though, with companies increasingly focused on strategy and execution, Zywave has taken such steps as making available free daily online training to support its broker partners as well as a variety of other professional development tools through its partner services.

"As important as the technology itself is, just as important is what kind of execution can you provide, how are we going to help you use it," Mr. O'Brien said.

Brokers working with Zywave say access to the various tech tools also puts them on better footing to compete with larger brokers both for accounts and talent.

"We just had a person last year who came from Marsh and she was at the (Zywave user) meeting last year and she just came away beaming that she has more tools now than she ever did," said Hylant's Mr. Lynott.

"Also helpful, I've found, is they've got a partner community," Ms. Thorne said. Through Zywave, partner brokers can turn to other partners to get information for their clients about other regions or exposures with which they're not familiar.

"It allows us to compete with the national brokers," said Commercial Insurance Services' Mr. White. "This really allows us to be able to network."

Though planned developments at Zywave over the next three to five years will include new products, much of the focus will be on improving current products and services.

"Our products are so deep and there is so much there for our partners to take advantage of, and their clients to take advantage of, that more is not the primary question right now," said the company's Mr. Mueller. Instead, much of the company's attention will be devoted to enhancing existing products and responding to partners' needs.

Partner input

While some of Zywave's new products and service improvements are developed proactively, many new offerings and enhancements come about directly as a result of the suggestions of partner companies.

The company aims to be responsive to its partners' needs, said Mr. Haack. "We do surveys. At conferences...we're all taking notes both on a structured and an unstructured basis. We field a lot of requests from our partners."

Recent upgrades to Zywave products include enhancements in the company's PlanAdvisor benefits product, which was originally designed to provide a claims analysis system that compares a company's experience against benchmarks and predict costs at renewal. In enhancing the system, the trick was "to take it beyond the 'gee-whiz' presentation" and help the client use the information to develop a strategic plan, said James M. Emling, executive vp at Zywave.

The improved product includes a renewal estimator, a plan modeler based on actuarial information and a spreadsheet-based plan selector tool that employees can use to obtain recommendations of the benefit plans that are best for them.

An updated version of Zywave's RALLE (for Risk Analysis Loss & Liability Examiner) Warehouse property/ casualty product is intended to allow brokers using the system to provide customers information that can help them make better decisions. Recent improvements include multiyear trend report capability and the ability to generate more sophisticated single-year reports.

A version of the company's Brokerage Builder tool that came out this year included several improvements in such areas as customer relationship management and broker workflow.

"It's not just a product that you buy that stays the same," Hylant's Ms. Thorne said of Zywave's offerings. "It's constantly updated."

And of the future of the company that emerged from efforts to do broker business better? "We do have some very definite plans," said Mr. Haack. "We clearly have some very exciting definite ideas for the future."