A customer service center or call center in an insurance agency/company needs an efficient way to organize the large volume of information required to interact with clients and potential clients on the telephone. Requests, problems, and queries from a demanding customer base challenge the resources of even the most efficient insurance call centers. Most call centers use some type of hardcopy reference source, commonly referred to as a desk reference, but a hardcopy manual is difficult to update and keep consistent across all copies in use. As a result, operators resort to homegrown methods to help them communicate effectively with clients (cheat sheets, sticky notes) and, when all else fails, will seek an answer from colleagues or their team leader, leaving the caller on hold.

This lack of efficient information retrieval diminishes the quality of the customer’s experience as well as that of the operator. It can cost a company in decreased employee production, lost business, and, worse case, legal fees incurred when defending an errors and omissions suit.

The following table illustrates the problems most insurance companies have with their current method of storing, retrieving, and maintaining the information their customer service representatives (CSRs) need to answer customer calls.

Until development of the 3-Click Desk Reference, insurance companies had only a couple options, neither of which successfully addresses the problems outlined above:

Saving 3 little minutes per call saves thousands of dollars per month.

After purchasing the 3-Click Desk Reference, a call center can potentially make an additional 1,087 calls per month per operator. The average cost per call decreases from $5.94 to $2.97, or a savings of $2.97 per call. 1,087 calls per month multiplied by $2.97 saved per call equals $3,228.39 saved per operator per month. With 15 agents using the 3-Click system, the savings skyrockets to $48,425.85 per month. The recovery ratio per week is $12,106.46 per week at 4 weeks per month.

If this insurance agency or company originally invested $15,000 in the development of their 3-Click Desk Reference, it will take them less than two weeks to recover their investment.

If this agency or company does not have sufficient call volume to realize such a substantial increase in efficiency, then it is possible that the number of operators can be reduced. The savings generated from a conservative 25% reduction in employee salary overhead (3 operators, for example) will result in a savings of 3 × $77,500 = $232,500 per year (or $19,375 per month). Again, an initial investment of $15,000 to develop their 3-Click Desk Reference will pay for itself in under 30 days.

Here are some additional considerations you might make when evaluating the cost of purchasing the 3-Click Desk Reference. These costs are difficult to quantify without knowing your company’s specific data and are presented here for you to expand upon when designing your own business case.

1. The cost of inefficient customer service and putting customers on hold
   

   KANA, an industry leader in providing solutions for Service Resolution Management (SRM), conducted a survey in which customers indicated they value prompt attention on the phone, quick responses to questions, and friendly staff above all other concerns. KANA’s research demonstrates the importance of technologies that enable CSRs to resolve any query, regardless of its complexity, while customers are on the line. (KANA March 15, 2005, http://www.kana.com/)

2. The costs-savings from reducing training costs
   
   There is no industry benchmark that pinpoints the average costs of training a call center operator, but a common ratio in the industry is that training amounts to 2% of payroll costs. (Intulogy, “Is Your Training Plan Keeping Pace With New Technology?” March 28, 2000. http://www.intulogy.com/good-reading/call-center-training-plan.html)
   

   The average call center operator training is 15 days. Currently, average agent compensation stands at US$ 32,000 per year (roughly $16/hour). The average cost to hire a new agent is US$ 6,500. The average cost for recruiting and training a call center representative is anything between US$ 5,000 and US$ 18,000. (Sail Labs, “Conversational Systems in Call Centers,” May 18, 2001. http://www.sail-technology.com)

   To put these figures into a meaningful perspective, let’s say that you can reduce operator training by 8 hours when using the 3-Click Desk Reference instead of requiring new operators to learn volumes of minutia that they can't possibly remember. $16/hour x 8 hours = $128 per employee savings in direct training costs. And don't forget the indirect training costs savings of reduced training room and trainer requirements.

3. The cost (in money and perhaps even in goodwill) of fixing mistakes
   

   Fixing mistakes in this business is more about customer retention than it is dollars. If you have to rewrite a policy because an underwriting rule was not up-to-date, you may lose the client altogether. Insurance companies know that customer retention is where the profit lies and it can’t be measured. How many customers do you lose if you make mistakes? That’s not really the correct question to ask. Here’s a better one: How many potential customers will you lose as a result of one unhappy customer? A rule of thumb is that if you give bad service to one client, 100 other people are eventually told about it.

4. The cost of errors and omissions
   

   The cost of an error and omissions claim against your insurance company can fall anywhere between the amount of your deductible, millions of dollars of awarded damages, or perhaps losing your entire business. As an insurance professional, you know that the cost of insurance increases when claims are made against the policy. If your company must defend an E&O claim—or worse, must defend more than one—your company may become uninsurable or may no longer be able to afford the E&O coverage that remains available to you.