From le­gacy to longevity: Mod­ern­iz­ing pol­icy ad­min­is­tra­tion

About the Au­thor

Digital Insurance - - STRATEGIES -

MKym Gully pro­vides the tech­nol­ogy direction for the Ac­cen­ture Life In­sur­ance & An­nu­ity Plat­form and also drives our Dig­i­tal In­no­va­tions busi­ness. Kym has more than 20 years’ ex­pe­ri­ence within the fi­nan­cial in­dus­try cov­er­ing all ar­eas of the soft­ware de­vel­op­ment life­cy­cle.

Kym Gully, Tech­nol­ogy Lead for Ac­cen­ture Life and An­nu­ity Soft­ware

ost life in­sur­ance com­pa­nies have spent decades and mil­lions of dol­lars main­tain­ing their ag­ing pol­icy ad­min­is­tra­tion sys­tems. But their work has been only partly suc­cess­ful. Although it might be ac­cept­able to main­tain a closed block of busi­ness on a le­gacy sys­tem, new busi­ness should be pro­cessed on a plat­form that sup­ports to­day’s breed of cus­tomers and prod­ucts, and that pro­vides the adapt­abil­ity needed to keep up with the blis­ter­ing pace of 21st cen­tury com­merce.

Com­pa­nies need to mod­ern­ize their pol­icy ad­min­is­tra­tion sys­tems, but they can’t do so us­ing costly, “big bang,” multi-year im­ple­men­ta­tions. In­stead, in­sur­ers should be look­ing for com­po­nen­tized, flex­i­ble in­te­gra­tion points with out-of-the-box adapt­abil­ity and a mod­u­lar ar­chi­tec­ture.

To­day’s tech­nol­ogy is fast-mov­ing and there are key as­pects of a mod­ern pol­icy ad­min­is­tra­tion sys­tem that a CIO or CEO needs to con­sider to keep pace with a mar­ket that is con­tin­u­ously re­defin­ing it­self for a dig­i­tal world.

Suc­cess fac­tors for mod­ern­iza­tion

CIOs have sev­eral goals in mind when it comes to mod­ern­iza­tion: elim­i­nate busi­ness and IT si­los; re­duce com­plex­ity; and de­liver a world-class cus­tomer ex­pe­ri­ence. They need to move the busi­ness for­ward which also re­quires suc­cess­ful in­te­gra­tion with an ex­pand­ing ecosys­tem of busi­ness part­ners and cus­tomers.

Based on our ex­pe­ri­ence, we see four suc­cess fac­tors that are es­pe­cially im­por­tant when it comes to pol­icy ad­min­is­tra­tion mod­ern­iza­tion:

1. Flex­i­bil­ity through a “mo­bile first” strat­egy. Com­pa­nies can­not af­ford an ap­proach that pur­sues dif­fer­ent so­lu­tions for desk­tops, tablets and phones. Tra­di­tion­ally, com­pa­nies built sys­tems for a desk­top and then only later con­sid­ered mo­bile re­quire­ments. To­day, the goal is “build once, use many times.” Off-the-shelf GUI in­fra­struc­tures make it eas­ier to cre­ate sys­tems that can be dis­played on mul­ti­ple de­vices.

2. Smart ap­pli­ca­tions. Em­bed­ding in­tel­li­gence into ap­pli­ca­tions is now crit­i­cal—au­to­mated ap­pli­ca­tions that of­fer straight-through pro­cess­ing and are driven by an­a­lyt­ics and self-gov­er­nance. The fo­cus should be on ex­tend­ing data avail­abil­ity both in­ter­nally and ex­ter­nally, lever­ag­ing an­a­lytic ex­ten­sions to use data that sup­ports the busi­ness and more ef­fec­tively en­gages the con­sumer. 3. Strate­gic al­liances. In a fast-mov­ing and com­plex marketplace, it’s no longer pos­si­ble to be a spe­cial­ist in ev­ery­thing. Al­liances are essen­tial. To de­fend and grow mar­ket po­si­tion and sup­port mul­ti­ple dis­tri­bu­tion chan­nels, new di­men­sions of ap­pli­ca­tion con­nec­tiv­ity are essen­tial. It’s im­por­tant to open up and in­ter­face with busi­ness part­ner and cus­tomer ecosys­tems.

4. A world-class cus­tomer ex­pe­ri­ence. De­liv­er­ing a com­pelling and sat­is­fy­ing cus­tomer ex­pe­ri­ence is a cru­cial dif­fer­en­tia­tor as car­ri­ers con­sider pol­icy ad­min­is­tra­tion sys­tems. The fo­cus needs to be on help­ing car­ri­ers build in­te­grated so­lu­tions that cre­ate per­son­al­ized, multi-chan­nel cus­tomer ex­pe­ri­ences at a re­duced cost. This is es­pe­cially im­por­tant when pro­vid­ing for the rapidly grow­ing ex­pec­ta­tions of the end-con­sumer in the dig­i­tal world.

...new busi­ness should be pro­cessed on a plat­form that sup­ports to­day’s breed of cus­tomers and prod­ucts, and that pro­vides the adapt­abil­ity needed to keep up with the blis­ter­ing pace of 21st cen­tury com­merce.

Key in­gre­di­ents

Com­pa­nies can take op­ti­mal ad­van­tage of th­ese trends by pur­su­ing in­no­va­tions in sev­eral ar­eas.

• Lead­ing in­fra­struc­ture: Ef­fec­tive in­fra­struc­ture must be real-time, cost­com­pet­i­tive and avail­able 24/7, with the scal­a­bil­ity needed to han­dle the peaks and val­leys of busi­ness ac­tiv­ity. Strong se­cu­rity is essen­tial for Web ac­cess. Also, to re­duce total cost of own­er­ship cloud is an op­tion few com­pa­nies can ig­nore. Pay for what you phys­i­cally use is the way for­ward.

• Best-of-breed ap­pli­ca­tions: Us­ing mod­ern tech­nolo­gies, ap­pli­ca­tions need to be tiered, lay­ered and flex­i­ble, as well as ag­nos­tic to the ecosys­tem so they can per­form in any en­vi­ron­ment. By tak­ing ad­van­tage of the open source world, car­ri­ers can im­prove their re­turn on in­vest­ment.

• In­no­va­tion-fo­cused lead­er­ship: Ef­fec­tive tech­nol­ogy and busi­ness lead­ers un­der­stand mar­ket direction, and they an­tic­i­pate and meet the ex­pec­ta­tions of next-gen­er­a­tion con­sumers. Suc­cesses found in other parts of the world can and should be adopted.

• Sup­port­ing the busi­ness: Lead­ers are pur­su­ing pre­dic­tive an­a­lyt­ics so­lu­tions for on­go­ing busi­ness sup­port. They are con­tin­u­ally look­ing to re­fine prod­ucts and ex­pand sales op­por­tu­ni­ties. At the same time, they seek to im­prove cost struc­tures through op­er­a­tional im­prove­ments.

Build­ing for the fu­ture

When de­cid­ing on con­crete steps to de­velop a flex­i­ble, world-class pol­icy ad­min­is­tra­tion sys­tem, an im­por­tant mes­sage for CIOs is to think both in the short and the long terms. Don’t try to do ev­ery­thing at once.

Be­gin with the core ca­pa­bil­i­ties, built in the cloud, and then look at other com­po­nents and their de­pen­den­cies. For ex­am­ple, in­fra­struc­ture sup­ports in­te­gra­tion, which then pro­vides the ba­sis for mo­bil­ity, which in turn pro­vides the dis­tri­bu­tion chan­nels for the ex­ter­nal user in­ter­face. Mo­bil­ity and in­te­gra­tion sup­port an­a­lyt­ics, in­no­va­tion is driven by in­te­gra­tion, and all facets are con­nected to the core plat­form and con­trolled by the in­fra­struc­ture.

The abil­ity to con­fig­ure a new prod­uct in one week does not help the time to mar­ket if the rest of the ecosys­tem re­quires six months to build out sup­port for down­stream sys­tems. It can’t all be done on day one, so a long-term tech­nol­ogy roadmap and in­te­gra­tion strat­egy is re­quired.

Think of it like solv­ing a jig­saw puz­zle. You be­gin with the cor­ners and edges and then work to solve the rest of the puz­zle. CIOs need to think of getting the ba­sics in place, and then en­sure that on­go­ing in­no­va­tions are de­vel­oped in sync with other parts of the puz­zle. It’s a way to make max­i­mum progress with a min­i­mum of re­sources and spend­ing, while getting the best re­sults over a multi-year pe­riod.

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