Filed Under:Carrier Innovations, Information Security

Q&A: How Software Vendors View the Insurance Market (Part 3)

In the third part of this series, technology channel editor Bob Hyle continues the conversation with a pair of vendors in the insurance software space to gauge their opinions on carrier weaknesses, project management, and their partnership with carriers.

Are insurance carriers making the right steps in the area of project management to ensure they are taking the right steps from selection to implementation of software? What do they need to do better?

Alex Naddaff, vice president, professional services for Guidewire Software: While we see the majority of carriers taking the right steps from selection to implementation, pace and timing is more the issue. Overall carriers still need to better prepare for faster paced projects delivered by empowered teams. Implementation of today’s modern and configurable technology solutions requires a different approach—a more iterative approach than the traditional waterfall method.  

(To read what other vendors have to say on these issues, check out Part 1 of the series, Part 2, or part 4.)

We are big proponents of using an agile approach for implementation and we encourage our customers to adopt this approach as well. In our experience, those who have embraced agile end up becoming their carrier’s internal champions and work to promote the approach as a company standard. That said, many carriers are still in the early stages of agile adoption, learning and refining their approach, and have not yet used Agile to its full advantage. 

Agile creates empowered teams that are allowed and encouraged to exceed business expectations. Agile also provides transparency to progress which enables engaged sponsors to stay close to the program throughout the implementation.  The combination of informed sponsors and empowered teams results in unprecedented success for many carriers.

Tim Attia, senior vice president sales and marketing for SeaPass Solutions: For the most part insurance carriers are taking the right project management steps, particularly relative to methodologies that employ an iterative approach to software implementation. And, when carriers focus the project on business improvement rather than simply getting a software application up and running, they tend to better avoid scope creep and cost overruns—and generally end up with a better result. A good project plan starts with the business motivation, the desired operational changes, and then the supporting technologies.

While most might think of a project and the associated project management effort in terms of software implementation, the project actually starts much earlier—at the point the carrier recognizes the business challenge or opportunity. The project plan should be much broader than software implementation. It should include the business case, the solution evaluation and selection, the implementation, and the follow up to ensure that the project has achieved the anticipated business objectives. 

And as a vendor, the sooner we are allowed to participate in the project and better understand the big picture, the more effectively we can support the carrier customer in meeting or exceeding their project objectives.

Do most insurance carriers look at you as a partner in the solution process or as a vendor? Please explain.

Attia: While our carrier clients consider us their partner, the relationship often doesn’t start out that way. Unfortunately, we find that many relationships with carriers begin with the carrier having a level of distrust when it comes to vendor promises and intent. Maybe it’s the sins of past vendors having oversold and under-delivered, but it’s real and something we address often and early in our interactions with a new carrier. Certainly, the references from our existing clients help the process and our good reputation goes a long way, but we still need to earn our partner stripes by making good on our commitments.

We start by ensuring the carrier that we will take the time to understand their requirements and that we are willing to share the risk of any project with them. By tying our pricing model to our deliverables and value we are able to begin to establish a level of trust and a true partnership.  

But, a partnership is a two-way street.  We ask our customers to give us the necessary access to their operation and users, so that we can gain an in depth understanding of their business challenges, requirements and desired processes. Only when we are afforded the opportunity to act as a consultant are we truly able to be a partner.

Naddaff: Most carriers look to Guidewire as a partner in the solution process. We establish close relationships with our customers and stay focused on their long term satisfaction, working closely with their teams to help them derive maximize value from the new solution. 

And, when you are working in a close partnership there are times “hard to deliver news” needs to be shared and tackled as a team. These are the times when the strength of the partnership is really put to the test.

If everyone keeps an open mind and is flexible in working together through the tough times that are inevitable in any complex implementation project, the effort is well rewarded with successful results. When customers are convinced that we are interested in learning, working side by side, and searching for the best solutions, then everyone benefits in the end—the carrier customer, Guidewire, and the overall industry. 

What specific areas do you see the most weaknesses among insurance carriers where new technology could offer the most help?

Attia: Carriers are not yet making maximum use of technologies that will allow them to most effectively reach and service the consumer—whether the consumer is an individual or a business.  Consumers are still somewhat intimidated by the insurance process, finding insurance overly complex and difficult to purchase. As a result, carriers need to respond by finding ways to leverage technology to make it easier for consumers to not just buy insurance, but also to help the consumer feel confident that they are buying the right coverage for the right price.

Technology that enables insurance carriers to be more online and real-time is a start.  But, the technology should  give the consumer what they want—an education on what and how to buy, comparison between options, the ability to network with like consumers or companies, and  the option to purchase through any channel they choose.

The objective for technology and for pleasing the consumer should be ease of doing business.   But it’s not just about the technology.  The right people and process needs to be in place, and products must also be crafted with a wide range of consumers and their varying needs in mind.  

Naddaff: Carriers today are under significant pressure to perform better due to macro-level trends such as lowering returns from investment income, an increasingly competitive market place and increased incidences of catastrophes. The vendor community is providing technology, specifically the core systems, that enable carriers to implement the business strategies required for long term success.

The specific areas of weakness and opportunity depend on the type of carrier, their culture and appetite for change. Applications exist today that will enable carriers to address specific points of concern—whether it be growing their business regionally and through new product offerings; improving the quality and speed of underwriting, addressing leakage in claims and billing operations or providing better service to policyholders and, where relevant, agents.

New technology and systems are merely tools. It is incumbent on people to use these tools to do the things they have always wanted to. It is encouraging to see that technology is helping carriers break down the organizational silos that tend to exist. 

IT teams, truly empowered with better technology and systems are more responsive to the business. The emergence of core system suites that span the policy lifecycle enable improved results by asking the question how interdependent business processes can be improved, rather than looking at improving individual functional areas. These cultural changes are very helpful as carriers look to the future. They help people to think of change in a positive, opportunistic way.


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