Buy Vs Build: Quoting Software in the Cloud Offers Less Risk Than Custom-Built Alternative

When it comes to saving time and offering customers an easier way of obtaining price quotations, the traditional solution meant expensive bespoke software for your company’s web server. Nowadays, an increasingly flexible and affordable option is emerging: sales quoting in the cloud via the Software as a Service (SaaS) model.

The numerous advantages of reduced cost, increased security and ease of deployment make online quotation software a compelling and cost-effective alternative to a custom-built product for improving your business’s effectiveness.

Increased Accessibility

An online quoting system that runs in the cloud provides ubiquitous, multi-user access. All of your clients and any number of your staff have access to the system all the time – at the same time – from any internet-connected computer. Not only can online quoting software cut down on staff workload, but empower your clients as well. This means your business will save money, and your customers will find what they’re looking for, faster.

More Bang for Buck

Sales quoting SaaS offers small businesses ancillary benefits that bespoke solutions typically omit, thanks to the significant infrastructure investments of SaaS providers. For a low monthly fee, subscribers are able to reap the rewards of substantial R&D required to build and maintain a secure network, integrate with other popular SaaS vendors (e.g. CRM), and offer more complex features. Per seat costs are typically less with the SaaS model, too.

Business owners who have switched to online quoting software solutions are satisfied. “We used to spend about 10 hours per week calculating quotes in Excel, converting them to PDF, and e-mailing to customers. [Using] online quoting software has cut that time almost to zero,” says Gord Walsh of GPS Commander.

Fast and Simple Deployment

Integrating an cloud-based quoting system with your business is fast and easy. Since the hosted solution does not depend on your own web server, no complicated installation or retrofitting is needed. The look and feel are easily customized to blend seamlessly with the web experience that your customers are used to.

Reduced Maintenance

With online quoting software, not only are the typical ongoing expenses for maintenance and support eliminated, but you benefit from free and automatic updates as the online quotation software evolves over time. The service scales with your business, and you only pay for what you need.

By employing an online quoting system, your business also benefits from enhanced security and greater peace of mind. Since the software is maintained by a dedicated staff, you no longer need to worry about maintaining a secure network on your own.

Low Barriers of Entry

Getting started with online quotation software is low risk. Most offer a free trial or a money-back guarantee. And since many services do not require a setup fee or a long-term contract, the investment in adoption is low.

“Before [moving to an online quoting system], our quote process was confusing and time consuming. The quote process time has now been reduced by over 90%,” explains Cary Yocum of Maintenance Connection.

To reach more customers, increase efficiency and improve your bottom line, consider making online quotation software a key part of your business’s online presence.

Don’t Accept Annuity Quotes That Violate State Insurance Rules

The authority of the insurance commissioner (or possibly another title) to regulate insurance business conducted within the individual states is contained in a title of state statutes usually known as the Insurance Code. There are usually corresponding rules also published to amplify the statutes. Insurance rules are often patterned after model language developed by the National Association of Insurance Commissioners, but they vary widely. Look for rules similar to those used below to illustrate the types of abuses that are common.

Rule: An “advertisement” includes illustrations originated by the insurer, its insurance producers or third parties.

Rule: Advertisements must contain complete information and not omit material information to be misleading or deceiving purchasers as to the extent of any benefit payable or any premium payable.

Rule: The premium shall also be shown on the annuity contract itself, according to the form filed with the Insurance Department. The name of the annuity issuer shall be clearly identified in all advertisements.

Rule: The prospective annuitant must not be misled into believing that he or she will receive some benefit not available to other persons of equal life expectancy.

Settlement offers frequently include cash components to be paid at the time of settlement plus “periodic payments” that will be funded through the purchase of an annuity. Illustration ledgers or “advertisements” presented to show the future payments being offered, but omitting the name of the proposed annuity issuer and the amount of premium required (the cost of the annuity), violate state insurance rules. When this happens, the claimant may not learn the identity of the company that will make those payments, including its strength and performance ratings by independent analysts, until after the offer is accepted.

After the terms of the settlement are agreed to by the parties, including the future payments to be made based on representations made to the claimant of their cost, the defense structured settlement broker sometimes will “shop” among several annuity issuers. If the same benefits can be purchased for less premium dollars from another company, or if the company quoted during the settlement negotiations subsequently offers a better rate, the annuity is purchased for less than represented during the negotiations. The savings are then retained by the defendant or its liability insurer and not passed on to the claimant in the form of higher future benefits or a larger cash amount paid at the time of settlement.

Unknown to the prospective annuitant, the life insurance companies will assign a “rated age” based on the assumption that the “measuring life” (annuitant) has an impaired life expectancy due to his or her overall health history. Rated ages are assigned by life insurance company medical underwriters based on medical history submitted by the structured settlement broker, often in violation of privacy regulations under the federal Health Insurance Portability and Accountability Act (HIPAA). The claimant has no idea that the lifetime benefits in the settlement proposal were based on a presumed shorter life expectancy and obtained at less cost than to provide identical payments to someone with a normal life expectancy.

If neither the claimant nor the claimant’s attorney is shown the cost of the annuity, in writing, the defense’s purpose very likely is to deceive the claimant into believing that the present value of the periodic payments is higher than it will actual cost.

Some life insurance companies that issue annuities designed and priced specifically for structured settlements issue computer software quoting systems to their agents that have options for a “plaintiff version,” omitting the cost and often the name of the annuity issuer, and a “defendant version,” which shows all relevant information. The use of the “plaintiff version” annuity illustration is a product of long-standing practice developed by liability insurers that serves no justifiable purpose and violates state insurance rules.

The plaintiff’s counsel should require that all future payment proposals made as a part of a settlement offer, where an annuity will serve as the funding asset, identify the name of the annuity issuer, the name and business address of the producer or insurer’s authorized representative (who must be licensed to sell annuities in the state), the premium required to produce the future payments illustrated, and the mortality risk assumption (whether a rated age is being considered). The illustration should also show the funding date assumption and the rate series in effect, including any daily rate, along with the quote’s expiration date.

The annuity contract, which is usually issued several weeks after the settlement, should reflect the actual premium paid, as specified on the approved policy form declaration page, not simply “valuable consideration” or “paid in full.” In this way, the attorney or the annuitant can compare the actual cost with the cost represented in the settlement offer. Any significant discrepancy should be dealt with immediately.

It is not enough simply for the defendant or insurer to fulfill its promise of making periodic payments, the defense must also spend what it said it would spend to provide those payments.
The plaintiff’s attorney can also be held accountable if the client is victimized by the defense.
Your best defense against such tactics is to engage your own structured settlement specialist to advise on periodic payment costs before mediation, then insist that all settlement discussions be conducted in terms of a single cash lump sum. If agreement is reached as to an amount the defense will spend to settle, you can direct that amount to be paid into a qualified settlement fund and call on your own specialist with a duty of loyalty to your client to set up the periodic payments. All tax benefits of a structured settlement are preserved when a qualified settlement fund is used for receiving settlement proceeds.