Kim Ber­wanger, Bright­house Fi­nan­cial

Digital Insurance - - CONTENTS - By Nathan Go­lia

At the be­gin­ning of 2016, MetLife an­nounced that it would spin off its U.S. re­tail busi­ness — that is, prod­ucts not sold as em­ployee ben­e­fits — into a new unit, Bright­house Fi­nan­cial. The key rea­son: At its size, the com­pany was sub­ject to strate­gi­cally im­por­tant fi­nan­cial in­sti­tu­tion des­ig­na­tion, which meant more cap­i­tal re­serv­ing re­quire­ments. Sep­a­rat­ing some part of the com­pany car­ried less com­pet­i­tive risk than keep­ing it to­gether, but re­quired lead­ers with adept skills in an­tic­i­pat­ing and ad­dress­ing the many po­ten­tial pit­falls of the move.

That’s where Kim Ber­wanger, SVP of IT for Bright­house, has shined over the past 20 months. She made de­ci­sions on which sys­tems Bright­house needed to lever­age from MetLife dur­ing the trans­for­ma­tion, drafted tran­si­tional ser­vice agree­ments with MetLife and de­vel­oped a vi­sion for the fu­ture state of tech­nol­ogy at the new com­pany. Es­sen­tially, Ber­wanger had to cre­ate from scratch the IT en­vi­ron­ment for a com­pany with more than $220 bil­lion in as­sets. She was able to de­liver in un­der two years, fac­ing in­tense dead­line pres­sure, so that the sepa­ra­tion could be fi­nal­ized and the next phase for Bright­house Fi­nan­cial could be­gin.

“The sepa­ra­tion of this por­tion of the re­tail busi­ness was based upon le­gal en­tity struc­ture,” she ex­plains. “The tech­ni­cal in­fra­struc­ture and sys­tems in our legacy Bright­house Fi­nan­cial foot­print at MetLife spans across 600-plus so­lu­tions, many of which are shared with MetLife. As we exit, we are set­ting up all new tech plat­forms.”

THE CASE FOR CLOUD

Through­out the tran­si­tion, Ber­wanger made the case for a more cloud-based IT en­vi­ron­ment, al­low­ing the new com­pany to es­chew a tra­di­tional data cen­ter and lever­age shared ser­vices to help re­duce op­er­a­tional costs. There was a clear mar­ket rea­son: Two-thirds of con­sumers say life in­sur­ance is too ex­pen­sive for them to con­sider buying it at re­tail, ac­cord­ing to LIMRA’s 2017 In­sur­ance Barom­e­ter study. Ber­wanger be­lieved that rather than keep go­ing with a tra­di­tional IT strat­egy, the com­pany had the op­por­tu­nity to change the op­er­at­ing model to a leaner, more ser­vice-based one. The sav­ings al­low the new brand to po­ten­tially of­fer lower-cost cov­er­age to cus­tomers, open­ing up a new com­pet­i­tive an­gle.

“We’re fo­cused on cre­at­ing a lower cost struc­ture,” Ber­wanger ex­plains. “As we’ve seen in P&C in­sur­ance, pric­ing has be­come an im­por­tant fac­tor.”

Bright­house’s more nim­ble IT en­vi­ron­ment, en­abled by mod­ern-era ser­vices, will also al­low the com­pany to in­no­vate at a high level in those other ar­eas, she adds. While Ber­wanger notes that the cur­rent state of ma­chine learn­ing and ar­ti­fi­cial in­tel­li­gence ca­pa­bil­i­ties for life in­sur­ance is not as ro­bust as in the P&C in­dus­try, Bright­house will be able to lever­age op­por­tu­ni­ties to in­no­vate more eas­ily than it could in the past.

“It will be eas­ier to plug in un­der­writ­ing en­gines than it would have been his­tor­i­cally, now that we have a sim­pli­fied ad­min­is­tra­tive plat­form,” she says. “Our com­plex­ity level to in­te­grate new or in­no­va­tive tech­nolo­gies into Bright­house will be re­duced.”

The com­pany is also grow­ing its own in­ter­nal data science team to in­no­vate on its own, and will ben­e­fit from hav­ing a sin­gle, cen­tral­ized source of data to lever­age in the fu­ture, she adds.

“[Data science] is a crit­i­cal com­po­nent of in­sur­ance go­ing for­ward, and this trans­for­ma­tion will give us a lift there,” Ber­wanger says. Tra­di­tion­ally, sim­ply get­ting us­able data for sci­en­tists to work with was a chal­lenge, but “that should be cleaned up for them,” she con­tin­ues.

Over­all, Ber­wanger says that the dif­fi­cul­ties of the split and the grow­ing pains for what is es­sen­tially a new com­pany are go­ing to pay off in a big way for the re­tail life in­sur­ance busi­ness: “In gen­eral, we have an amaz­ing op­por­tu­nity that a lot of com­pa­nies don’t get.”

Kim Ber­wanger SVP of IT, Bright­house Fi­nan­cial

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