For the past couple of issues, thanks to the world we live in, Ive taken my 500-word forum here to wax political. Enough of that; its time to get back to my day job.
Insurers IT departments have been taking a beating over the last few years. The lack of experienced COBOL programmers in 1998 and 1999 made preparations for Y2K that much harderand more expensive. And the dot-com boom took so many other good techies out of the market with lures of astronomical salaries, employee retention became a major issue. And soon after the dot-com bubble burst, the economy started in on that other part of its cycleyou know, the part where the line goes down.
And then came September 11.
So here are insurance carriers: Theyre stunned by massive claims all the way up the reinsurance chain. Theyre watching their other sources of incomeinvestmentsweaken along with the economy. (By making heavy investments into commercial real estate, many carriers unwittingly put all their eggs in one basket. How much is loft-office space in Silicon Valley worth these days, anyway?) Breaking the traditional economic rules, inflation has been steadyand lowso bonds also seem to be going nowhere. Combined ratios are through the roofover 120 percent in some cases. So not only are insurers hesitant to implement expensive solutions that might save money in the long run, their IT departments are overwhelmed just handling day-to-day maintenance.
But you knew that already.
One of the things this economic shift means is that the mandate of carriers IT departments is changing: Its switching from investing in technologies that streamline processes, to finding short-term cost-cutting measures. If it doesnt promise a quick ROI, put it on a back burner. Wireless connections for claims reps are out; fraud-fighting tools are in.
You knew that already, too.
One plan weve seen go by the wayside is the oft-touted demise of the mainframe. As prices for technology fell dramatically, it seemed to make economic sense to think about moving away from big iron. As one person commented to me at ISOTech last month, You can only wrapper so much. Now those mainframes are looking like good, solid machinesmaybe just file servers, but file servers that have been paid for.
Our cover story this month looks at those mainframes and how you might keep them around. We spoke with several people, and as you might expect, they offer several ways to look at the problem. And speaking of several people, dont miss our annual whos who section. This year we look at five CIOs who have each done something notablefrom tackling a massive database integration project, to going the build your own route for an agent portal. They impressed us; we hope theyll impress you.
Andrew Kantor Editor-in-Chief
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