A Novarica study revealed that ‘core system modernization’ is one of the top priority projects that P&C insurers are pursuing today to achieve flexibility, speed-to-market, customer growth, and underwriting profitability. QA strategy for automation and application-specific testing play a crucial role in successful realization of such projects. The article discusses the critical elements in Farmers Alliance’s QA strategy for their core system transformation project as shared by Andy Edwardson in a recent webinar.Why do insurers need core system modernization at all? The lack of flexibility in legacy systems has been limiting insurers’ ability to 1) bring new products and changes to existing ones quickly, 2) accommodate modern technologies, 3) reduce operational costs, improve efficiency, and 4) analyze data to gain business insights.
Andy stated that these challenges compelled Farmers Alliance to modernize their core systems (policy, claim and billing) with the objective to keep their lines of business growing.
BUSINESS AND IT VENDOR TEAM COLLABORATION
Andy shared that purely from the governance and testing perspective, they had a week long kick-off session at the onset of the project. The goal was to bring together the vendor and all business units participating to discuss and set up a framework on how they were going to execute a testing strategy and deliver results. This helped stakeholders to understand how the project would work, what the major milestones were, and what the high level scopes were.
Some of the key initiatives that came out of this session were:
- Governance structure that included business-IT collaboration
- Iterative rollout to mitigate risks and deliver functionality incrementally
- Established robust architecture to align with business goals
- Established teams to support initiative
THESE ELEMENTS LED TO SUCCESS OF QA TESTING FOR FARMERS ALLIANCE
Emphasis on ‘quality first’ and importance of quality across lifecycle activities
Andy stated that they brought changes to their existing testing environment. Traditionally, when they would test rates or specific systems, they had a fairly mature practice in place. They would first do it in their typical testing environment, then move it to an UAT environment before the business would be accepted, and finally migrated to production. However with this project, they have moved the testing activities to a quality assurance environment to look at various touchpoints.
Establish importance of quality across lifecycle activities - requirements, development, testing and release management
Andy added that they took a very formal approach about requirements as well as development iterations and release management, which were critical for success of their testing strategy.
Establish automation as a key component to manage multiple & iterative deployments – across architecture layers
Andy stated that they did not plan to introduce test automation initially, but through the course of the project they needed automation tools to tackle the large volume of testing, which was starting to demand a lot of time & effort.
THE LESSONS LEARNED
Andy added that one of the challenges they had from the beginning of the project was to focus their testing efforts in testing all the interfaces as opposed to their traditional testing of rates, UI, etc. Moreover to improve operational efficiency workflows, rules, etc. were automated in the systems to achieve straight-through-processing. As a result, the QA team needed to put more emphasis in testing this area to ensure straight through processes work successfully.
Click below to view the webinar Achieving success in core system testing on-demand featuring Novarica, Farmers Alliance, American National and ValueMomentum to learn how two P/C carriers successfully led their core system testing initiatives.