The Technology Foundations of Advantage for Insurers
Treating Data a Strategic Asset, Straight-through-Processing, and Frictionless Communication are Key for insurers.
In its recent strategy work with insurers, Celent has developed a visual articulation of the sources of business advantage and their dependency on technology foundations. Celent's latest report " " explains how insurers are using the ideas in the visualization to create and evaluate their IT strategies.
The visualization resembles a classical temple. "Advantage" is the entablature, which is supported by two pillars, service and risk management. These two pillars rest on three stacked foundations, which are data as a strategic asset, straight-through-processing, and frictionless communication.
"Celent developed this visualization recently through conversations with insurance CIOs during client engagements, conferences, and informal contacts," explains Matthew Josefowicz, manager of Celent's insurance group and author of the report. "We've found that it resonates with many of them and gives them useful vocabulary for discussing strategy both within IT and with their business-side partners."
The key elements in the visualization are:
- Service: Providing efficient, helpful communications with and transactional capabilities for all stakeholders, including distributors, policyholders, risk or benefit managers, and importantly, internal employees.
- Risk management: All of the areas of insurance that involve evaluating and pricing risk throughout all stages of the product life cycle, including actuarial, product design, pricing, rating, underwriting, claims adjusting, reserving, reinsurance, and asset management.
- Data as a strategic asset: Ensuring that risk data, customer data, and operational data is clean, accessible, and transparent within the organization.
- Straight-through-processing: The seamless flow of information in a consistent electronic form through the various automated and human-interface systems involved.
- Frictionless communication: Reducing the cost and difficulty of every interaction among internal and external stakeholders.
The report puts high-priority IT initiatives like portals, SOA, legacy replacement, and enterprise data models in the context of the visualization, and discusses how insurers are using the key concepts that it articulates.
The report is 15 pages long and contains five figures and tables. A table of contents is available here.