Effective Technology Use in Insurance

Celent, a leading financial services research firm, recently published their annual Celent Model Insurer Report outlining effective uses of technology in twelve categories such as policy administration, underwriting, product design and definition.

You are probably asking yourself what is a “Model Insurer”?  Well, according to Celent there is no such thing as a “Model Insurer”—every insurer does some things well, and others not as well when it comes to technology.

The vision for Celent’s Model Insurer research is to try to answer an apparently simple question: “What would it look like for an insurer to do everything right with today’s technology?” Of course, the question is not nearly as simple as it appears. The terms “everything” and “right” mean very different things to different insurers depending on their size, the complexity of their operations and product sets, and their technological starting points.

Within the Property & Casualty market, the impact of insurance product freshness and getting quality products to market faster has proven to have a positive financial impact on the bottom line.

Whether a company attempts to roll out an entire new line of business or make one change to a rate table, the time to market can take anywhere from minutes to months. Being nimble enough to adjust pricing strategies and provide competitive new insurance products is crucial to a company’s ability to adapt to a difficult marketplace, but overburdened IT departments required to write code for every alteration can create huge bottlenecks for the business.

CNA Insurance, the 7^th largest U.S. commercial insurer, was recognized as a 2011 Celent Model Insurer in the category of product design and definition for their ability to successfully improve IT and business alignment in the insurance product development process enabling them to get quality products to market 30% faster.  This strategic initiative to streamline processes, reduce costs and increase capacity for insurance product development may sound relatively easy, but in large organizations to get all key stakeholders aligned and working together to create consistent, repeatable processes is a significant achievement.

With over 300 product changes per month, CNA realized that there was an immediate need to change the insurance product development process to eliminate high-touch, error-prone manual processes in order to reduce overhead and enhance product innovation. To accomplish their goals, they needed to make insurance product lifecycle management a core competency.

Collaboration with all the business and IT users was also critical. To succeed, they would need buy-in from key stakeholders from underwriting, actuarial, claims, marketing and other departments. To bring together these diverse groups and align IT and business stakeholders, CNA selected Camilion’s ProductAuthority, an insurance product development and management solution built specifically for the insurance industry.  Today, approx. 600 individuals including underwriters, actuaries, product developers, product managers, product architects, business system analysts and executives are involved in the new processes and technology.

Congratulations CNA for being recognized as a 2011 Celent Model Insurer!

To read the full Celent 2011 Model Insurer Report click here or for further information on how CNA has increased their time to market click here to read the article Faster, Better, Cheaper featured in Insurance & Technology.

Within the Property & Casualty market, the impact of insurance product freshness and getting quality products to market faster has proven to have a positive financial impact on the bottom line.