Open Standards May Be Next For SANs

The insurance industryone of the mostdata-intensive businesses aroundis seeing more companies upgradetheir data storage, moving from direct-attached storage to storagearea network (SAN) environments to improve flexibility andutilization of their hardware.

The next big trend could be open, uniform standards for the SANenvironment among various competing vendors, but that's still a fewyears away, some industry experts said.

“I think the next big change in data storage will be a SANenvironment based more on open standards,” said David Annis, chiefinformation officer at the Hartford Financial Services Group Inc.in Hartford, Conn. Currently, when companies implement a SAN, theyhave to pick the flavor offered by individual vendors, Mr. Annisnoted.

“We expect the next move will be shared storage pools withmultiple vendors all using the same open standards for theirproducts. But that's probably going to take some more time,” hesaid.

Hartford, which has some 27,000 workers and a data storagecapability of more than 100 terabytes over 2,000 servers, uses 10specialists to monitor its storage facilities around the clock.

“Most of our new systems use a SAN environment where weessentially provide shared storage pools for a variety of businessapplications across the company. The backbone of our data storageis magnetic disk storage, supplemented by tape cartridge silos,which are still the most cost-effective means for long-term storageneeds. We also use optical storage to a small degree, generally fordocument imaging,” Mr. Annis said.

Hartford has been deploying SAN for well over a year now, headded. “The business case for SAN is very compelling. As companiesmove away from direct-attached storage, they can get a much higherdegree of utilization for business units.”

The company currently has two large data centers and half adozen smaller centers around the country; it backs up the data atoff-site locations. For business units that have high availabilityrequirements and can't afford significant downtime, the companyalso provides real-time mirroring of information across multiplephysical locations.

But despite the expanding volume of managed dataa developmentshared by all successful companies across all industries, Mr. Annisnotedthe good news is that the cost of conventional magnetic diskstorage has been decreasing dramatically.

But the falling cost and improving performance of conventionalstorage could be bad news for optical storage, whose viability isbeing called into question by some industry experts.

“The jury is still out on whether optical storage is a viablealternative. The question is whether it will be a cost-effectivechoice. Companies now have the capability to store large amounts ofdata very cost-effectively [using] a relatively small staff,” Mr.Annis said.

Newark, N.J.-based Prudential Financial Inc., another majorplayer that has adopted SAN, currently uses standard magnetic disksalong with optical disks and utilizes tape libraries to back up itsdata. The company has 160 terabytes of capacity for its distributedstorage arena and some 60 terabytes for its mainframe.

“Storage requirements are continuing to grow as we retain moreand more information from our clients,” said Anthony Costa, vicepresident of systems engineering at Prudential. “We've gone fromstandard direct-attached storagea base technology that's beenaround for a whileto SAN, supplemented by network attach storage(NAS), which is file sharing over existing networks.”

Although Mr. Costa also foresees an industry-wide standard forthe SAN environment, he noted that the change is probably going totake at least a few more years.

“The industry as a whole is trying to create a standard, butit's a difficult challenge,” he said. Looking forward to 2003, Mr.Costa asserted that optical storage still has a lot of potential,especially as ultra-dense optical is poised to hit the market nextyear.

The move towards SAN is embraced by smaller players as well. Forexample, mid-sized specialty P-C carrier American Modern InsuranceGroup Inc., part of The Midland Company in Amelia, Ohio, has alsobeen deploying SAN.

“I am a big proponent of SAN. It is a trend we are seeing and itis something our company will continue to expand on,” said JohnCampbell, chief information officer at American Modern Insurance.“We are also in the process of building data warehouses and datamarts that will drive our storage needs for next several years. Weuse traditional direct access storage devices, as well as someoptical storage for images, and we have tape backups.”

The company's storage system vendor is EMC Corp. in Hopkinton,Mass., while its primary database management is done by RedwoodCity, Calif.-based Oracle Corp. It backs up data to tape librariesfrom Louisville, Colo.-based Storage Technology Corp., Mr. Campbelladded.

Kent Sunderland, director of enterprise operationsadministration at Country Insurance and Financial Services inBloomington, Ill., said he has been examining SAN for some time tofigure out what best fits his company's needs. Currently, CountryInsurance has some 400 servers, all using direct-attached storage,as well as two automatic tape library silos for a backup. Hiscompany is also considering using emerging iSCSI, a new Internetprotocol-based storage networking standard for linking data storagefacilities, which works in much the same way a SAN does.

“iSCSI can offer the flexibility of a SAN without the cost ofcreating a whole new network, but it hasn't really matured yet,”Mr. Sunderland said.

Many insurance brokers have also been busy upgrading their datastorage systems. Arthur J. Gallagher & Co. in Itasca, Ill., andChicago-based Aon Corp., for instance, have been moving away fromdirect-attached storage and are migrating toward SAN environments,with some NAS when appropriate.

“Data storage needs for brokerages continue to grow, and morecompanies have been moving into this space. Benefits are tied tobetter availability and recovery. It also allows you to expand yourstorage much more easily,” Aon's Chief Technology Officer GregCasagrande said.

Overall, the insurance industry has seen enormous changes in theway its companies store and retrieve their corporate data.

“For the most part, just a few years ago, companies had bigwarehouses that stored claim files. The first thing companies hadto do to retrieve data was to drive to a warehouse and then lookthrough boxes,” said John Eager, senior director of claims servicesat National Association of Independent Insurers in Des Plaines,Ill.

“But today, we are in a completely different world. Now,employees don't even have to leave their desks. Companies can getinto data storage and search with file numbers, dates or places ofaccident, and they can retrieve files right away. And the storagecapacity is enormous compared to just a few years ago,” headded.

Other developments that have been contributing to less use ofpaper in the industry involve the utilization of the Internet tocreate and retrieve files.

“Many people can now report claims on the Web. This is a greatblessing. If you report by phone, there is an extra step wheresomeone has to type the information in. Online filing is routedright into the adjuster network, and when claims are closed, theygo straight into data storage. Any extra step you can eliminate isbeneficial, which cuts down on paper and makes it faster toretrieve data,” Mr. Eager said. “Once insureds get their claimnumbers, they can log in and check the status. It's akin to how wetrack the status of express mail.”

Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, December 16, 2002.Copyright 2002 by The National Underwriter Company in the serialpublication. All rights reserved.Copyright in this article as anindependent work may be held by the author.