In his recent report on how technology delivers competitive advantage to insurance carriers, Matt Josefowicz, leader of the insurance practice at Celent, uses a classic temple to portray how the base provided by IT can support the pillars of service and risk management to help carriers attain advantage in the marketplace. “[The study] boiled down both the business side and the technology side of insurance to their deepest core elements,” he explains.

For the business side, the service pillar includes service to agents, policyholders, and internal stakeholders, according to Josefowicz. “This gives everyone the information and capabilities they need to do what they need to do,” he says. The second pillar is more than just enterprise risk management. He contends everything insurers do involves managing risk, citing pricing, actuaries, underwriting, claims handling, reserving, and reinsurance.

Those two sets of business activities are supported by three technology foundations, continues Josefowicz. The most basic foundation involves treating data as a strategic asset, he maintains, and making sure enterprise data is accessible and can be analyzed by business users. “It needs to be relatively clean to anyone who might need it, whether that means customer service people, business users presenting data to agents, or those doing detailed analytics for risk management purposes,” he says. “It all starts with enterprise data. Companies need to realize data is their only strategic asset.”