Thursday May 17, 2012

It's a Wrap at ACORD LOMA 2012

In our discussions with customers, Oracle Insurance has noticed an increasing number of multi-year transformational projects. Insurance companies are recognizing that their existing IT systems have become so complicated, they’re actually holding insurers back, instead of helping them to move forward. This was reflected in our 2011 industry survey, where nearly two-thirds of insurers said they could provide better customer service if they had better IT.

During yesterday’s Platinum session at ACORD LOMA, Oracle’s Srini Venkat and Roger Soppe focused on the business drivers behind these transformational projects. They gave a number of real-world examples of insurance companies who are undertaking real-world transformations. They noted that one size does not fit all: transformation can take many different paths. Some examples they discussed:

Focus on business rules. Srini Venkat noted that in this approach, the goal is often to extract, consolidate and simplify the huge numbers of business rules that insurers have. These rules may govern everything from rating and underwriting to policy processing. He gave the example of one insurer who wanted to be able to support growth over the next 10 years. When the company looked at replacing and consolidating its multiple policy administration systems, it discovered that the number of rules would overwhelm a new core system. Instead, the insurer decided to focus on product configuration and rating, with a phased approach to policy admin replacements. It’s looking at a number of new tools to manage its business rules, 40% of which are related to rating and underwriting. In this approach, volume and complexity were the insurer’s key considerations in transforming its business.

Consolidate rating. For many P&C insurers, rating engines are where product information lives. Insurers often have multiple rating engines tied to policy administration systems, web portals, or other systems. This leads to inconsistent pricing, compliance issues, and the inability to develop innovative products. In addition, rating engines that are locked into policy admin systems are often inflexible and lack the ability to scale.

Consolidating onto a single, rules-driven rating engine can help alleviate these issues. Srini Venkat gave examples of three different insurers who have taken this route. The benefits have included accurate pricing, an increase in the number of new business quotes, more automation, faster product development, and improved ease of doing business for agents and customers.

Replace core systems. For life and annuity carriers, speed to market is often the key business driver. Insurance is a first-mover business, and those who can be first to market with a popular product often come out the winners. In addition, life insurers often lack customer self-service capabilities, they want to create products that agents and brokers want to sell, and they are saddled with the high costs of maintaining multiple, legacy policy administration systems.

Roger Soppe discussed several customers who chose to replace their aging policy administration systems with a modern, rules-driven one. The results they achieved included faster speed to market, better-selling products and increased revenue.

Modernize distribution. The final transformation approach discussed during this session focused on modernizing distribution. Many carriers struggle with the high cost of distributing their product portfolios to diverse channels, and agents often find it difficult to do business with multiple carriers. Roger Soppe shared the story of one life insurance direct marketer who chose to use a data exchange service. This gave them a central hub which they could use as a single source of data for the multiple carriers who use the service. By using a single, aggregated feed, the marketer lowered its IT costs and found it easier to do business with a multitude of carriers.

The presentation was well received by the Twitter-sphere, with attendees tweeting that they enjoyed the story-telling approach. 

Today featured a presentation from Oracle customer CNA Insurance. AVP Lindsay Fassett shared details of the company’s approach to transformation, a five-year project with the ultimate goal of delivering superior service to customers and agents for CNA’s highly profitable commercial lines. While there are five separate pillars to the project, Fassett’s team is focused on the “speed to market” piece, which includes product configuration, rating and document production. The company selected Oracle Insurance Insbridge Rating and Underwriting as its rating engine, and Oracle Documaker for the production of forms. Fassett shared that the business side of the house, including actuaries and underwriters, are very much involved in IT selection, and they selected Oracle Insurance Insbridge because the application would be easy for them to use to create and manage rates.

The conference wrapped up this evening with a Cuban-style party hosted by ACORD LOMA. It was a fun and successful event, and we look forward to doing it all again next year!

Tuesday May 15, 2012

Flying High at ACORD LOMA 2012

ACORD LOMA 2012 kicked off today in Orlando. While the official welcome doesn't happen until this evening, there were a few "pre-conference workshops" today that provided educational content for early arrivers. One of these was Oracle's session entitled "Flying High: How the Cloud Can Make Insurance Firms More Successful." While there is lots of information out there on cloud, it was nice to get some specific information about why the cloud matters to insurance.

Mary Pilecki, who came to Oracle from the RightNow acquisition, opened the session with an overview of how consumer expectations are changing, driven by their experiences with banks, communications providers, and even social media. Consumers want to be able to research insurance offerings, shop online, compare rates, and get recommendations from other customers before they make the decision to buy. Yet many insurers still struggle to provide a consistent level of online self-service. The cloud enables this by acting as a central place for data, providing the same information to consumers whether they are purcashing online, via a call center, through a mobile app, or from a broker.

Another way in which the cloud can help insurance companies is through scalability. Rather than operating a large call center, which is expensive in terms of real estate and equipment, insurance companies can use the cloud to let customer service agents work from home. This allows the insurer to save on infrastructure costs, and makes the company an employer of choice. In addition, it can help the insurer ramp up service quickly during a catastrophe. Agents can get online easily from home, allowing the insurer to add more staff to handle the higher volume of calls. Even if the insurer's head office is in the middle of the disaster zone, the cloud infrastructure is often located elsewhere—meaning the company can keep serving its customers.

Oracle's David Krauss then outlined Oracle's strategy for the cloud, which includes offering customers a choice of cloud arrangements: private, public, or hybrid clouds. He also discussed security concerns, which are always top of mind for insurers. One of the advantages of Oracle's approach is that it embeds security into every level of its cloud offerings: hardware, database, middleware and applications. Learn more about Oracle's cloud strategy and how it can help insurance companies in this video. 

Wednesday's sessions include a presentation from Oracle VP Srini Venkat and Senior Director Roger Soppe. Please join us in Panzacola H1-2 at 3:30 PM, as they discuss strategies and options around business transformation for insurance. And don't forget to drop by Booth #711 to pick up your red wristband for our Wednesday night customer celebration, poolside with live DJ. See you then!

Monday Nov 21, 2011

Smooth Sailing or Rough Waters: Navigating Policy Administration Modernization

Life insurance and annuity carriers continue to recognize the need to modernize their aging policy administration systems, but may be hesitant to move forward because of the inherent risk involved. To help carriers better prepare for what lies ahead LOMA's Resource Magazine asked Karen Furtado, partner of Strategy Meets Action, to help them chart a course in Navigating Policy Administration Selection, the cover story of this month’s issue.

The industry analyst and research firm recently asked insurance carriers to name the business drivers for replacing legacy policy administration systems. The top five cited, according to Furtado, centered on:

  • Supporting growth in current lines
  • Improving competitive position
  • Containing and reducing costs
  • Supporting growth in new lines
  • Supporting agent demands and interaction

It’s no surprise that fueling growth, both now and in the future, continues to be a key driver for modernization. Why? Inflexible, hard-coded, legacy systems require customization by IT every time a change is required. This in turn impedes a carrier’s ability to be agile, constraining their ability to quickly adapt to changing regulatory requirements and evolving market demands. It also stymies their ability to quickly bring to market new products or rapidly configure changes to existing ones, and also can inhibit how carriers service customers and distribution channels.

In the article, Furtado advised carriers to ensure that the policy administration system they are considering is current and modern, with an adaptable user interface and flexible service-oriented architecture. She said carriers to should ask themselves, “How much do you need flexibility and agility now and in the future? Does it support the business processes and rules that are needed for you to be able to create that adaptable environment?”

Furtado went on to advise that carriers “Connect your strategy to your business and technical capabilities before you make investment choices…You want to enable your organization to transform for the future, not just automate the past.”

Unlocking High Performance with Policy Administration Transformation also was the topic of a recent LOMA webcast moderated by Ron Clark, editor of LOMA's Resource Magazine. The web cast, which featured speakers from Oracle Insurance and Capgemini, focused on how insurers can competitively drive high performance by:

  • Replacing a legacy policy administration system with a modern, flexible platform
  • Optimizing IT and operations costs, creating consistent processes and eliminating resource redundancies
  • Selecting the right partner with the best blend of technology, operational, and consulting capabilities to achieve market leadership
  • Understanding the value of outsourcing closed block operations

Learn more by clicking here to access this free, one-hour recorded webcast.

Helen Pitts, is senior product marketing manager for Oracle Insurance's life and annuities solutions.

Friday Nov 04, 2011

Oracle Insurance Earns Two ACORD Achievement Awards for Life & Annuity

Oracle Insurance earned recognition for its continued leadership, adoption and implementation of ACORD (Association for Cooperative Operations Research and Development) industry data standards for life insurance and annuities. The recognition came during a special ceremony held on November 3 at the ACORD Implementation Forum in Fort Lauderdale, Fla.

Oracle received two awards specifically for its use of ACORD web services standards by Oracle Insurance Policy Administration for Life and Annuity:

  • Early Adopter Award - Life & Annuity Plug and Play (PnP)
  • Early Adopter Award - ACORD Web Services Profile (AWSP) standard

Oracle was cited by ACORD for developing, implementing and certifying its use of the AWSP standard in its policy administration system to support these ACORD LAH XML transactions:

  • Add Beneficiary (Life)
  • Add Beneficiary (Annuity)
  • Customer Contact (Client Record)

Earlier this year the company successfully demonstrated its use of the AWSP web standards during the ACORD PnP Tooling Jamboree at the 2011 ACORD LOMA Insurance Systems Forum.

"Oracle is to be congratulated not only for earning these awards, but for its continued leadership in showing the industry how beneficial ACORD data standards are for improving business, integration, and data flow,” said Lloyd Chumbley, Vice President, Standards, ACORD.

Oracle is a long-time member of ACORD and has been involved in the association’s working groups for life insurance and annuities, including the ACORD PnP Consortium Working Group. These latest awards from ACORD demonstrate Oracle’s ongoing commitment to the adoption of industry standards in its solutions for the insurance industry. Oracle previously received an ACORD Achievement Award in recognition of its use of ACORD messaging standards for the implementation of Oracle Insurance Policy Administration for Life and Annuity at Securian Financial Group.

Helen Pitts is senior product marketing manager for Oracle Insurance's life and annuities solutions.

Friday Oct 14, 2011

Defining the Rules for Rules-Based Systems

Replacing legacy IT infrastructure with modern, rules-based core systems is a hot topic and is receiving much attention in the industry—just open up a recent insurance technology print or online publication.

One of the carriers I spoke with last week at Oracle OpenWorld said this barrage of information had some within his company questioning what really defines a true, rules-driven policy administration system

Olivier Lafontaine, director of strategy and solutions for EquiSoft, helped to bring some clarity to this topic during his Oracle OpenWorld session, Policy Administration Implementation Levers for Mid-tier Life Insurance Carriers.

Lafontaine explained what distinguishes a rules-driven systemone that has been built from the ground upagainst those that are purported to be such systems (for example, a rules-engine inside a hardcoded system) is its capability to empower a team of business and technical users (actuaries, product managers, rules developers and others) to collaboratively configure transactions that support business process using business rules, without the need to customize or recompile the system’s core code or database structure.

Lafontaine went on to explain that a highly-configurable system that leverages business rules instead of requiring hard-coded customization can provide a carrier with newfound flexibility to:

  • React to market changes faster than the competition

  • Consolidate power in their nicheservice is key to the mid-market

  • Support new products and new distribution channels

  • Reduce operating costs by eliminating redundant tasks, automating transactions over time, and consolidate / optimize user tasks

To find out the more about rules-based policy administration, like Oracle Insurance Policy Administration for Life and Annuity, watch Lafontaine’s session online at Oracle OpenWorld On Demand—along with all keynotes, general and breakout sessions). You can also check out his Oracle OpenWorld interview on the Oracle Insurance YouTube channel along with interviews conducted with Oracle Insurance product strategy and industry leaders to learn more about Oracle’s rules-based, adaptive systems.

Helen Pitts is senior product marketing manager for Oracle Insurance's life and annuities solutions.

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