In late 2010, XL Group introduced a new business strategy thatwas designed to change the direction in which the insurer washeading to include global expansion with new business units, newproducts, and more complex risks. The new strategy presented achallenge to the carrier's IT department, headed by Robin Arendt,Global CIO.

“The [current] technology was not going to support the businessdirection and what it was going to take for us to expand, or tointroduce new business units,” says Arendt. “The older technologywas going to prohibit us from expanding and that expansion was thekey to driving profitable growth for XL.”

Like many large insurers, XL Group has multiple systems it hasacquired through acquisitions over the years.

“We have multiple policy writing systems thatdon't talk to eachother and we have data quality issues as well,” says Arendt. “Thisproject was unique in the sense that the business strategy wewanted to undertake was going to push the envelope.”

Arendt laid out the problems XL needed to solve:speed-to-market, improved data quality, and integration ofanalytics.

“What we were looking for was a dynamic, flexible platform thatwas easy to configure knowing the complexity and diversity of ourproduct suite,” she says. “That was a big driver for why we lookedat FirstBest Systems and why we ended up choosing FirstBest. I'vebeen in this space for 23 years and haven't seen such abusiness-friendly, intuitive, comprehensive software package outthere yet. I was impressed.”

Over a period of nine months, XL performed its due diligence andconducted a proof of concept that Arendt feels proved to everyonethat the FirstBest underwriting platform will be able to supportthe XL strategy and vision.

Part of that nine-month timeframe involved introducing anoverall IT strategy for XL. The carrier put together a three-yeartechnology roadmap. The FirstBest platform is just one of eightinitiatives that Arendt explains are running in parallel.

After completing the proof of concept for XL Group's workers'compensation line of business, the carrier and the vendor are nowdeep into the development and working toward delivery in the firstquarter of 2011.

“Our solution set is best-of-breed, so integration is probablyour biggest challenge and risk point,” says Arendt. “Not only arewe going to have to plug into our back-end legacy systems, we alsoare combining FirstBest on the front end from the data capturepoint to be the single source for our underwriters to rate, quote,and issue.”

The challenge involving integration comes from the fact XL isimplementing three different solutions from FirstBest, AccentureDuck Creek, and PCIS.

“There are going to be challenges, but when I think about whathas made us successful so far and why I think this is going to besuccessful going forward, we are mitigating our risk into differentareas,” says Arendt.

Arendt's IT group has a strong business sponsorship along withthe right business resources that understand the importance of theproject, according to Arendt. In addition, XL is rolling out theproject incrementally.

“We are following FirstBest's best practices on chunking up thescope and rolling it out by product line vs. a big-bang approach,”she says. “If you have business sponsorship and the rightincremental approach I think it mitigates the risk of a typicalmigration/integration challenge.”

With such a large scope, Arendt realized she needed a stellarteam on this project to make sure it could happen.

“We're leveraging FirstBest for the critical roles as far asarchitecture and product knowledge,” she says. “We did duediligence to pick the right partners, so we have a thorough globalsourcing program with three key suppliers. As our key partner wechose Accenture, so there was the due diligence of software as wellas our consultant partner.”

XL has four different business units and 14 different productareas that need to be tackled.

“As we roll it out we are taking product lines as well asincreased capabilities and functionalities,” Arendt says. “It's atwo-pronged approach. It's not just building a transactionalsystem; it's about imbedding analytics into our predictive modelingand pricing automation into this platform so there really is oneplace for the underwriters to go. We're bringing in internal andexternal data and making sure we leverage that. When you look atthe entirety, the underwriting system is just one piece of ourbusiness model.”

John Belizaire, founder and CEO of FirstBest, reports he isimpressed with the team Arendt has put together to lead this effortfrom the program management level all the way down to the staffworking on the company's architecture.

“They took time to look at how best to lay out the project,taking into account potential risks and integration items betweenthree new systems and also looking at an architecture that lays thegroundwork for XL to achieve their goals,” he says. “The key tosuccess with these projects is spending time planning out thedecisions with a lot of focus around getting value quickly andreducing risks.”

XL Group chose workers' compensation as the first line ofbusiness for the implementation.

“We worked closely with the business units, not only laying outour vision, but the best way to prioritize driving value for thebusiness up front,” says Arendt. “ForNorth America, workers'compensation is our biggest area of growth. When you look at thedifferent business areas across XL between p&c and reinsurance,we started focusing out of the gate onNorth Americaand where we seethe market opportunities and where we can get the scale. Theproject was prioritized based on business value.”

In addition to the XL Global project, this has been a specialyear for FirstBest as well. The company recently announced it hasachieved 125 percent growth in orders over the previous year aswell as doubling its customer base. Belizaire cites demand for itsfront office suite of applications as the company driver.

“FirstBest is seeing great interest from large world-classcarriers eager for greater profitability, flexibility, efficiency,and integration from their underwriting and policy systems,” hesays.” Our explosive growth in 2011 validates the need for a commonand strategic front-office solution for the entire insuranceenterprise. We are laying the groundwork for multi-line carriers totransform their infrastructure to deliver account-centricunderwriting across the enterprise, and to deliver trulycollaborative and efficient service to their agents andbrokers.”