When Disaster Strikes: Allstate Goes Mobile

Insurance giant Allstate has a team of storm chasers armed with a RV equipped with satellites and wireless connectivity. The goal: Help customers weather the next Katrina.

Darel Myers is a storm chaser.

Myers, technical equipment manager for Allstate Insurances 10-year-old national catastrophe team, brings mobile connectivity via satellite-equipped mobile homes and a bevy of laptops whenever a disaster—be it a tornado, a hurricane or an ice storm—strikes.

"Theres never an off-season," Myers said. "Just because its not in the media doesnt mean its not a catastrophe. Theres a lot of damage [year-round]."

While thats true—Myers was headed toward a tornado zone when speaking with eWEEK—the manager acknowledges that the hurricane season that started June 1 is prime time for Allstate, which defines a catastrophe as a "concentrated amount of losses based on a weather-related issue."

And given that the National Weather Service is predicting a busy hurricane season, Myers, based at Allstate corporate headquarters in Northbrook, Ill., will be on the road plenty this summer.

In May, the weather service predicted 13 to 16 named storms (the first was Tropical Storm Alberto, which hit Florida the week of June 11), with eight to 10 becoming hurricanes, of which four to six could become major hurricanes of Category 3 strength or higher.

The good news: That projected total is down from 2005s record 28 storms, which included Katrina, the storm that ravaged New Orleans and the Gulf Coast. The bad news: 2006 will be above the average of 11 named storms per year.

According to the Insurance Information Institute, of Jersey City, N.J., the hurricane season of 2005 had insured losses of $57.3 billion, up from $23.7 billion in 2004.

How should a company set up mobile technology infrastructure to prepare for whats shaping up to be such a rocky season? While Allstates approach to mobility may not be classified as cutting edge, executives at the insurance company say keeping it simple meets business goals and makes technology management easier in extreme circumstances.

Myers arsenal includes six RVs housed in Baton Rouge, La., that can be dispatched to multiple areas. These mobile homes include satellite dishes to link up broadband connections.

Claims agents in the field are armed with laptops that connect to Allstates enterprise system in Northbrook via wireless cards from providers such as Verizon and T-Mobile.

"What weve done is to give the adjuster[s] a mobile claims office where they can process claims and issue checks faster and cheaper," Myers said, noting that Allstate often sets up shop in Wal-Mart and Home Depot parking lots to assist customers.

Theres a good business reason for those mobile applications. Allstates mobility and ability to process claims quickly is what matters to the customer, said Michael Roche, senior vice president of protection technology and administration at Allstate.

In 2003, Allstates Property and Casualty division moved from a model where information systems were shared across units to one where Roches group had more control over its technology.

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According to Roche, the key was giving "technology a voice at the table" so it could enhance claims processing. From there, it became clear that Allstates adjusters needed wireless access to handle claims.

"Wireless entered at different places, but the first place was claims because of our adjusters and their need to work from the field," he said. "Before 03, they would take notes on laptops and then come into the office."

By making Allstate adjusters more mobile, the insurance company can enhance customer service and please another key contingent—Wall Street. On Allstates second- quarter-earnings conference call April 18, the hurricane season was a hot topic.

CEO Edward Liddy fielded questions from analysts about the companys projection of 1.5 million to 2 million catastrophe claims in the third calendar quarter. "What happens in the third quarter with respect to catastrophes is the ultimate guess," Liddy said.

Next Page: Managing complicated hurricanes in a simple way.