The HippogryphA Blend of Old Beasts to Help Insurers Fly
Insurance Experts' Forum, April 6, 2011
In a few unrelated conversations last week, the question of configuration and business design came up. In each case the conversation was related to modern policy administration or product specification systems used in the insurance industry, with a background of legacy applications still hanging around. The conversations inevitably turned to the experience and skills profile required by someone who configures modern systems to the business requirements.
Whilst the different insurers concerned used different names and had slightly different purposes, the base requirement was for someone very familiar with how the insurance business ran, but with the engineering discipline and experience an IT background gives.
Increasingly we’re observing that modern insurance systems allow for configuration. Configuration can stretch from ticking a box on a form, to updating a table of figures used in a calculation through simple formulas all the way to full-blown scripting languages. This trend isn’t just present in insurance systems; in business intelligence the use of Python and other scripting languages have long been used to clean up and prepare data. In both cases the question arises: Is this an IT job or not?
Herein we see on a small scale the change that has been brought across all of our society, where programming skills, previously the sole purview of the IT department, now may sit with underwriters, curators of an insurers content and analysts reviewing a wealth of data. What has not migrated out of the IT department yet is the discipline born of years of painful implementations—discipline around correctly specifying the problem, testing the result and planning for failure.
As it happens, most insurers come to rely on a mixed and experienced team from both an IT and an insurance background. Each team member fills the gaps left by other team members and, together, processes are established. Some vendors are now providing training courses for configuring their platform, but even the vendors I’ve spoken to admit this can be hit and miss. “Some people just aren’t cut out for writing and testing business rules,” they say.
Until universities and schools start producing candidates with a mix of insurance awareness and IT discipline, insurers will have to continue to rely on a mix of internal staff experience in order to move forward with legacy and modern core systems.
In Harry Potter, we see the young wizard take to the skies on a hippogryph—part eagle and part horse. The hippogryph takes the best of each creature to allow harry to fly through the air as easily as riding a horse. Insurers are finding that they must create a new role in their organization, merging IT discipline and business know-how to allow them to meet their lofty goals.
This blog has been reprinted with permission from Celent.
Craig Beattie is an analyst in Celent's London Research Group.
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