PARTNERSHIP FOR QUICK TO MARKET ENTRY

1. PARTNERSHIP FOR QUICK TO MARKET ENTRY JCG CONFERENCE SEPT, 2009 Steven Weiss, SVP LOTSolutions Jonathan Yee, SVP Chartis Insurance

2. AGENDA • Introductions and Overview • Discussion on Topic • Product Development Cycle Times • Partnership vs. Outsourcing • Aspects of an Effective Partnership • Case Study • Questions

3. QUESTIONS ON NEW PRODUCTS • How important are new product introductions to achieving your sales goals? • What percentage of new product introductions succeed? • How important is speed-to-market for new product introductions?

4. ANSWERS • Some insurance companies estimate that new products represent 25%+ of new sales. • Less than 30% of new products achieve their expected results. • Speed-to-market is VITAL for achieving your sales goals.

5. WHAT TAKES LONGER? • New home construction – average home? • Having a baby? • New insurance product launch from concept to in market?

6. CYCLE TIMES • New home construction 6-9 months. • Delivery 9 months. • New insurance product 9-12+ months.

7. WHY DOES IT TAKE SO LONG? • Poor initial definition of opportunity. • Competition for internal resources. • Competing internal priorities. • Squeezing a round peg in a square hole.

8. WHAT’S THE SOLUTION? • Partner with an outside expert for specific functionality.

9. 6 STEP PROCESS • Product concept, definition and expectations. • Pricing and design. • Filing and approvals. • Marketing and distribution. • Fulfillment and service. • Analysis and reporting.

10. IS PARTNERING THE SAME AS OUTSOURCING? • Outsourcing is subcontracting a process to a third party company with the intent of lowering cost or making better use of time and expenses. • A partnership is a long-term strategic relationship between customer and supplier based on achieving best practices and sustainable competitive advantage.

11. ASPECTS OF AN EFFECTIVE PARTNERSHIP • Common vision. • Strategic leadership. • Clearly defined roles. • Mutual trust. • Efforts towards cultivating the relationship. • Communication – open and frequent. • Information exchange.

12. ASSESSING A PARTNER • What is their role? • What do they contribute to the relationship? • What drives their interest and commitment? • What concerns them? • How important is the relationship to them? • What benefits do they bring? • What are the costs and risks to them?

13. CASE STUDY Chartis Insurance

14. CHARTIS INSURANCE • Chartis began in 2001. • Experience as an underwriter for large cases and agent distribution. • Limited domestic experience with DR sold product. • Corporate resources focused on core business. • Looking for revenue opportunities.

15. CHARTIS INSURANCE • Opportunity • IMO had successfully Beta tested a DR product. • IMO was seeking an underwriter. • IMO had proven track record in DR distribution. • One product. • One market – credit card files. • One channel – outbound telemarketing.

16. CHARTIS INSURANCE • Dilemma • Chartis liked the DR business model. • Chartis understood the revenue potential. • Internal resource constraints. • High volume transaction processing and service not a core competency. • What to do?

17. CHARTIS INSURANCE • Options • Walk away. • Lost opportunity. • Build internal capacity. • Time and cost. • Resource strain. • Buy capability. • Time and cost. • Partner with others.

18. CHARTIS INSURANCE • An easy decision to make. • Establish partnerships • Distribution – IMO. • Marketing/sales –IMO. • Administration and service – TPA.

19. CHARTIS INSURANCE • Today • 5 IMO partners • 25 products plus versions • All DR channels • Multiple markets • 1.7MM policies in force • 1.4MM new annual enrollments

20. CONCLUSION • You can’t be all things to all people. • Do what you do well and partner with other experts for what they do well. • Pick a partner with aligned objectives. • Beat the competition to market. • Be a star.

21. Q&A THANK YOU Steve Weiss, sweiss@lotsolutions.com Jonathan Yee, jonathan.yee@chartisinsurance.com