Insurance Networking News - Strategies 2011

terry BroWn Vice president, implementation services, insuresoft

industry speaks

dan soBotincic executive Vice President, Head of P&C division, sapiens

in reality, carriers
should not lose
sight of some of
the integration
complexities.

What are the advantages and disadvantages of a best-of-breed versus an end-to-end solution? When does it make sense for a carrier to choose one over the other?

best-of-breed solutions, in theory, should satisfy the business units desires and needs to improve each respective business unit. in reality, carriers should not lose sight of some of the integration complexities. this can be best represented through overall lack of data transparency, utilization of different technology stacks, and lack of consistent user interfaces. to help mitigate these risks, carriers should look to partner with a vendor that can implement one module at a time yet still provide the majority of the end-to-end core applications. more specifically, the carrier can then focus on improving internal operational efficiencies and leverage system benefits compared to managing the product integrations.

— terry Bro Wn insuresoft

How should carriers go about getting the support they need from policy administration technology providers for successful deployment of new or enhanced systems?

carriers have the unique ability to leverage the expertise provided by technology vendors as they are going through a deployment of a new solution. more specifically, a carrier can leverage the rich industry and technology expertise provided to them through a vendor by taking advantage of their client list. i would also suggest that you spend time with existing vendor customers to understand what support record the vendor historically and currently provides to its customer base. lastly, it is imperative to have a detailed project plan in place that clearly defines goals and identifies the needed resources from both parties.

What are the advantages and disadvantages of a best-of-breed versus an end-to-end solution? When does it make sense for a carrier to choose one over the other?

end to end (e2e) implementations can often be successful when carriers are looking to replace legacy composite systems that often times had one application that did multiple functions like policy administration, billing, claims and re-insurance. often, carriers have had to acquire multiple systems to meet market needs, making rip and replace risky. also, e2e implementation tends to be more successful in smaller companies with limited products and processes to change. negatively, replacing all core systems at once can weigh heavily on resources and have higher risk. When considering best of breed systems a carrier needs to ensure that it is properly architected, so it can take advantage of soa and web services, which make integration of best of breed solutions a reality. Up front costs of best of breed can be higher then end to end, but long term return on investment is higher, because of advanced functionality

received out of best of breed.

Celent’s shares its “lessons learned”: have a strategic mandate for change; break large projects into manageable parts; avoid creating a new legacy environment; and throw out legacy business processes and take advantage of new systems to create new processes.

EMERGING TREND Insurers in the mid-market increasingly are gravitating toward suites of products because they answer the highly complex integration problem. Increasingly ACORD standards are driving strategic partnerships and these types of improved solutions. n

contAct informAtion

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Products that often took months into years to bring to market are now being brought to market in weeks.

How are policy administration systems addressing carriers’ speed-to-market concerns? How has the technology advanced to provide faster product development?

not only is speed to market for new products critical, also the ability to tweak and change rates, rules and forms in specific market segments that already exist are a must to succeed in today’s market. today’s configuration tools allow for business users the capability to bring products to market, without the intervention of it. in the past, business users would have to write requirements and then translate those into technical requirements, so coding could be performed before a product went to market. after that job function was done, advanced coding by technical staff would need to be done, before complex testing needed to take place, which often created many errors. products that often took months into years to bring to market are now being brought to market in weeks, without a high total cost of ownership, which in turn drives up product and company profitability.