Listen to the full webinar where we discuss alternatives to expensive and possibly out-dated legacy systems
Is the market moving towards a more agile claims space with new technology?
Insurance Times hosted a webinar last month exploring the alternatives to potentially rigid and out-dated legacy systems.
Sponsored by 360Globalnet, with guest panellists James Harding, operations director at 360 Globalnet, Nick Smith, head of claims transformation at AXA Insurance, and Integra’s head of claims, Andrew Morgan, the webinar explored where claims are heading, what technology may be needed, and what insurers have been told needs to be done.
Harding started out by insisting software doesn’t need to be expensive, take years to implement and then take even more time to make changes if needed.
He said: “It’s going to be a huge project that will last around two years or so. And then after that, you have to maintain the internal infrsustructure with a big IT department that will keep the system working.”
He also pointed out that insurers are told that these systems have to be fully integrated with existing systems, and he said that the message from 360 Globalnet is that “this is not the case.”
Smith agreed with Harding, saying that there are some myths out there, but he felt that the mission should be what is important, and that will give you a better knowledge of what system you will need.
“We have our software with Guidwire, we are not shy about that,” he said. “Large insurers with big books tend to get sucked into large IT programs that become very complex.
“But my starting position is that you have to be really clear what the objectives are and what you are trying to achieve. The more you go down the path of implementing a large system, the more the system takes over and you lose sight of the objective. We were guilty of that. We lost sight of what we were doing.”
“Start with a clear objective and clear road map, then start choosing the system and software and technology that you think you need.”
IT holds the cards
Harding agreed with Smith’s point, stating that what he sees in the industry is that the technology appears to have taken over.
He said: “IT holds all the cards, unfortunately. I think the technology has the control at the moment, and it needs to be given back to the business so it can do what it has set out to do.
“But i totally agree with what Nick has said. You need to have clear objectives before you have the technology.”
Morgan said that Integra approached its claims system from a different angle.
“We went through that whole process but then we were given the opportunity to look at new technology and what we could do with it. So we came at it from a different angle.”
Morgan then stated that there are difficulties with big, complex systems ”because there is a lot going on within that.”
But Integra looked at the new technology, Morgan said, just to try it out and see what could be done with it.
Integra used a claims and policy administration system before, but Morgan said that when they looked at the new technology, it was a lot more flexible and that was the difference.
“It did sit with us in claims, it sat with the claims guys with what they wanted to do and the direction they wanted to take.”
Why are people still implementing old systems if there is a quicker, cheaper alternative?
Harding felt that the shift to the newer systems hasn’t quite taken off yet because, historically, there has been a lack of an alternative.
“It is the herd mentality. It is a well-established name, a well-established system. Companies are told by large consultancies, who they pay millions of pounds, what to do with it. So I feel it is a lack of alternative, historically.”
He then suggested that insurers have two options:
1. “You bring in a system from a very established company, like Guidewire and that costs tens of millions of pounds. Then you have to bring in the consultancy firm to tell you what to do with it.”
2. “Or you build it yourself. We see lots of projects fail around the world this way. Insurers don’t have the core competency to build IT systems. You end up with a three hump camel because lots of people will be involved and will want their needs met. By the end you have designed and built something that isn’t fit for purpose.”
Harding then said: “We are offering a third option.”
Listen to the whole webinar below:
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