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How insurers can leverage their core systems to build digital capabilities


At the 2016 IASA conference, held in San Antonio, Texas - Novarica, Erie Insurance and ValueMomentum collaborated to present a session titled Digital Journey: From Strategy to Implementation. Siva Pillai, Client Partner, ValueMomentum, who was one of the panelists in the session, shared his experiences and insights on digital transformation for P&C carriers from an IT practitioner’s perspective. During his presentation, Siva spoke about the importance of carriers leveraging their core systems to build digital capabilities without needing to rebuild these systems.

To compete and win in the digital economy, carriers must connect with the customers at a faster pace by rapidly building up on the experiences at the point of sales and services. However, carriers’ age-old core systems inhibit their speed to market with building the modern experiences at the front-end. How can carriers reuse their core systems effectively and efficiently to support the front‑end innovations?

Enable front-end innovations independent of the core systems

Siva stated that carriers’ core systems are key to their business, remaining the same over the years. These systems are mostly responsible for managing their back office operations, where not much of the innovations have happened. Therefore, technologically they are rigid and inflexible. The rigidity of the core systems cannot match the requirement of supporting a dynamic and flexible front-end. Carriers need to keep their front-end systems flexible to be able to build innovative customer experiences without knowing the specifics of the core system complexities. The capabilities at the front-end for creating the enriching experiences cannot be tied strongly back to the core systems functions.

To keep the front-end innovations independent of the core systems, carriers have the choice of either rebuilding or reusing their core systems. Rebuilding would demand a lot of time and effort, which could potentially slow down carriers’ digital transformation. Given that, they need to match faster time to market while providing great customer experiences, there is need for the carriers to find a different way to reuse their existing systems.

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Reuse, don’t rebuild

Providing the technological solution to overcome this problem, Siva stated that carriers need an architectural component that would enable them to separate their front-end systems from the core system functions. This architectural component would empower them to completely control the experiences and without the core systems dictating how the experiences are created. Carriers can achieve this capability by creating a ‘gateway to core’ using APIs, which would enable simple access to multiple core systems. 

Thus, the API gateway would enable carriers to reuse the core systems by establishing connections to leverage core systems' data, transactions and functional capabilities. Carriers can achieve this by partnering with a solution provider who can help create this gateway to completely control the experiences and not have the policy, billing, and claim systems influence the experiences. The separation of the front-end presentation layer from core system functions is a critical architectural implication for carriers to achieve successful digital transformation.


You can watch Siva Pillai, Client Partner, ValueMomentum, sharing his insights on how P&C insurers can leverage their core systems to build digital capabilities by playing the below video:


WATCH THE COMPLETE VIDEO 

If you are inspired by the takeaways of the post and want to learn more, click below to watch the complete recording of the session.

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