1. Wonsik Kim Wookyung Kim Yunil Kook Hiroshi Shiomi Welly Sugiarto
BPOL 541: Ecommerce: Competing on the Internet
NetUpdate
Wonsik Kim
Wookyung Kim
Yunil Kook
Hiroshi Shiomi
Welly Sugiarto

2. NetUpdate Background of the project Claim Process Industry Overview
Agenda
NetUpdate
Background of the project
Claim Process
Industry Overview
Proposed Business Model
Summary – 6 C

3. NetUpdate Internet software development company
Background of the project
NetUpdate
Internet software development company
based in Bellevue
loanupdate, the division of Netupdate
started in Sep 1999
product for mortgage industry(market size : $1.5trillion)
main user : Firsta Home Mortgage, Qpoint and etc(4,000 users and 400 companies for 8 months)
Mar 2000 : Partnership with iOwn
provides iOwn’s online wholesale lending products
Apr 2000
closed $9Mil funding from iOwn.com, eFundLLC and etc
acquired Byte Enterprise, provider of loan origination software

4. Business Model Revenue CTS(Collaborative Transaction Servers)
Background of the project
Business Model
Revenue
$2 Mil in 1999
$300,000 from Jan 2000 to Feb 2000
sources : transaction fee, monthly fee, license fee
CTS(Collaborative Transaction Servers)
From a serial process to centralized managed process
Provides access to data & communications to each user depending on their needs.

5. NetUpdate Background of the project Insurance Real Estate Business
Rules System
Mortgage
Docu-
ment
NetUpdate
Collaborative DB
Document
Mgt. Services
Contact
CRM
Platform
Product
Pricing
Message
Transaction
Data
Pricing &
Product DBs
, Voic
Intenet Fax
Mission-Critical
Application

6. LoanUpdate Personal Web Page Internet Office Online Application
Background of the project
LoanUpdate
Personal Web Page
Internet Office
Online Application
Borrower Communication

7. Expansion Searching for new business opportunities
Background of the project
Expansion
Searching for new business opportunities
Insurance (ClaimUpdate)
Construction (BuildUpdate)
Real Estate (HomeUpdate)

8. Initial Contact with insured Review report & Clear payment
Claim Process
Claim Process (1)
Receive Claim
Through agent, call center, or adjuster
Sometimes use independent adjuster
The insured may hire a public adjuster
Appoint Adjuster
Initial Contact with insured
Site Visit
Normally within 24 hours
Estimate Value
Report to Insurance Co.
Review report & Clear payment
Auto insurance claims tend to take longer

9. Claim Process
Claim Process (2)
The process is highly complicated with various participants
The adjuster sits in the middle of communication and business process
Insurance
Company
Service
Provider
Adjuster
Insured
The adoption of the Internet technology is slower than other industries

10. Industry Overview: Insurers
Personal-lines property/casualty insurance
Net premiums written in 1999: $151.8 billion
Auto: 79%, Homeowners: 21%
Fragmented
Only two insurance companies with over 10% market share
Top 100 companies command 90% of the market
Internal adjusters
80,000 to 100,000 employed by insurance companies
Each adjuster manages $1 million to $1.5 million in annual claims loss damage

11. Industry Overview: Other Players
Public adjusters are highly fragmented
Only a few companies with national presence
Most public adjusters are region-based small firms or individual offices
Service providers are also fragmented
Regionally located
Insurers have lists of preferred service providers from which the insured can select

12. Industry Overview: Competitors
Software/IT solution providers
From Windows-based package software vendors to mainframe system integrators to ASPs
Some are focused on the claim processing area, others are providing modules as part of total system
In-house IT department
Some companies are aggressively moving online
E-commerce companies
Only two E-Insurance companies are providing online claim filing service
Some new companies are specialized in claim processing (e.g. goClaims.com, CLAIMserv, ClaimsOnline, etc.)

13. Initial Contact with insured Review report & Clear payment
Proposed Business Model
Target for Solution
Receive Claim
Adjuster
Appoint Adjuster
Process Bottleneck
Human Interaction
Initial Contact with insured
Insured
Service
Provider
Site Visit
Estimate Value
Insurance
Co.
Report to Insurance Co.
Review report & Clear payment

14. Revenue Source Public Adjusters Value Proposition Revenue Model Issues
Proposed Business Model
Revenue Source
Public Adjusters
Value Proposition
Accurate and detail activity recording
Communication / Process Management Tools
Internet Sales Channel
Revenue Model
Set Up and Subscription Fee
Issues
Market Size

15. Initial Contact with insured Review report & Clear payment
Proposed Business Model
Revenue Source
Insurance Company (Small-Medium Size)
Receive Claim
Appoint Adjuster
Value Proposition
Improved efficiency for internal adjuster
Improved efficiency in managing public adjusters
Online Claim Submission and Processing
Revenue Model
Set Up Fee, License Fee, Transaction Fee
Issues
Integration with Legacy system
Initial Contact with insured
Site Visit
Estimate Value
Report to Insurance Co.
Review report & Clear payment

16. Revenue Source Package Software Provider Value Proposition
Proposed Business Model
Revenue Source
Package Software Provider
Value Proposition
Adjusters can use software without having to “invest”
Sales channel for software developer
Revenue Model
Transaction Fee
Issues
Software Value
Frequency of Use

17. Revenue Source Claim Solution Service Provider Value Proposition
Proposed Business Model
Revenue Source
Claim Solution Service Provider
Electronic Claim Processing
Electronic Insurance Company
Claim Service Provider (call center)
Value Proposition
Communication and process management support to complement existing service
Revenue Model
License Fee
Issues
Build Vs. Buy

18. Summary Context Content Community Key value proposition:
“Improve efficiency of claim process by supporting adjusters in managing tasks and communication with all parties involved”
Content
Existing content providers
Community
Existing (non-profit) community of adjusters

19. Summary Communication Competition Connectivity
Facilitating communication:
Adjusters, Insurance Company, Insured
Suppliers, Other party (Lawyer, Independent Appraisal)
Competition
Existing (early) competitors
LoanUpdate success story
SPEED
Connectivity
Complementary Partners

20. Wonsik Kim Wookyung Kim Yunil Kook Hiroshi Shiomi Welly Sugiarto
BPOL 541: Ecommerce: Competing on the Internet
Questions?
Wonsik Kim
Wookyung Kim
Yunil Kook
Hiroshi Shiomi
Welly Sugiarto