IT service providers are able to play an important role to help the Insurance industry to change faster to a Digital Insurer. With the necessary excellent knowledge of Insurance business, products, processes and IT, an IT service provider will be able to implement a full Insurance cloud solution that works in principle for every Insurance company in the world. The critical success factor is a cloud Insurance service platform able to handle complex products and processes due to market practices and different digital ergonomics depending on the country and organization.

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IT SERVICE PROVIDERS TO PLAY AN IMPORTANT ROLE
IN THE DEVELOPMENT OF DIGITAL INSURANCE.
In the coming three to five years, all Insurance
companies have to implement the digital version of their
company. The definition of Digital Insurance will be
different for every company depending on target
markets, ambitions and capabilities. Distributors and
customers will mainly dictate the service and
functionality requirements and Insurance companies will
have no choice to follow and invest in an agile digital
organization. A paradigm shift is necessary to implement
Digital Insurance, as the internal Insurance organization in most cases will resist the necessary
change. Strong transformation leadership will be crucial in implementing a ‘World Class’ Digital
Insurer in the fastest possible timeline.
Digital Insurance
Digital Insurance basically is to sell insurance products and provide insurance services fully
digitized anytime, anywhere and on any device. Sales and service functionality is available for
distribution and service partners. Customers are able to buy and renew insurance products
direct online or on mobile devices. Self-service portals and mobile apps are available for
customers and partners to change policies, pay additional purchased products and features,
notify the Insurance company of claims and enquire on products, services, transactions, policy
and claims status. Furthermore, Digital Insurance includes a full automation of all internal
processes including straight through processing, digital and social marketing, big data analytics,
rule-based underwriting, rule-based claims management and “bring/choose your own device” for
every employee to work anywhere, anytime on any device. The internal organization will be
completely paperless. Customers, distribution and service partners will mainly enter data only
one time which will then be available in all processes anywhere and anytime.
Implementing Digital Insurance affects all departments in the company. An integrated vision,
strategy and tactical plan are crucial to deliver a Digital Insurer successfully. Digital Insurance is
not an online portal built on top of back end systems including all the complex functionality and
processes requested by the internal organization. Digital Insurance includes rationalization of
products, processes and IT, streamlining of internal processes, simplification of products,
underwriting and claims practices and redefining sales, marketing and distribution.
Transformation
There are different ways to redefine and transform an Insurance company into a Digital Insurer.
One method is to transform the organization based on an integrated strategy in a traditional
(waterfall) approach.

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IT SERVICE PROVIDERS TO PLAY AN IMPORTANT ROLE
IN THE DEVELOPMENT OF DIGITAL INSURANCE.
The traditional approach is complex and the risk of failure is high due to the following reasons:
- Transformation will be executed in parallel with running the day-to-day business, which
in many cases will result in continuous resource problems for the transformation
projects.
- The same people that created the current business and operating model will define
transformation for a large part. They will have difficulties to understand and visualize the
required organization and redefine the organization to a World Class Digital Insurer.
- Internal management and staff are not aware of all available technology and will not be
able to bring all components together into a fully digitized organization.
- A big reorganization will create resistance as it will change the way of doing business,
way of working and will redefine the organization structure including positions and job
descriptions.
- Full time strong leadership to ensure employee engagement, quality of proposed
solutions and timely decision-making is necessary. This will clash with other priorities
like short term financial targets.
The first method will be the preferred method for most Insurance companies. Another method is
to define the digital insurance organization out-of-the-box, in a ‘greenfield’ perspective, based
on the principles and standards of the Insurance industry, the current and expected changes in
the Insurance business and different market maturity and practices. A ‘World Class’ Digital
Operating Model defines the business and IT environment, suitable to be implemented in any
Insurance organization. This second method will be the preferred method for external IT and
service providers and is based on the best possible digital operating model for Insurance.
Assuming that both methods aim for the same quality end result, the risk of the first method is a
long timeline, high cost and delays due to all kinds of problems and mistakes, too many
compromises in the implementation, additional overruns, change-weariness and finally losing
the competiveness where competitors are able to change better and faster. The second method
is based on a “greenfield” implementation without the internal transformation difficulties during
the design, development and deployment.
The cloud solution for Digital Insurance
IT service providers are able to play an important role to help the Insurance industry to change
faster to a Digital Insurer. With the necessary excellent knowledge of Insurance business,
products, processes and IT, an IT service provider will be able to implement a full Insurance
cloud solution that works in principle for every Insurance company in the world. The critical
success factor is a cloud Insurance service platform able to handle complex products and
processes due to market practices and different digital ergonomics depending on the country
and organization.

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IT SERVICE PROVIDERS TO PLAY AN IMPORTANT ROLE
IN THE DEVELOPMENT OF DIGITAL INSURANCE.
From a technology perspective, all IT components are available. Cloud computing in terms of
infrastructure and platforms are available, robust and used by many companies in the world. A
‘World-Class Insurance platform provided as a service is not available yet. The first IT service
provider able to deliver a ‘World Class’ Digital Insurance Platform fast will create a big
competitive edge in the market and Insurance companies using this platform will be able to
create a completive edge in their business as well.
For every business component, many good IT solutions are available. The initial challenges are
the definition and implementation of a ‘World Class’ Insurance Software suite as a service,
including:
1. Comprehensive product models able to handle multiple product features on different
levels and complex pricing algorithms.
2. Robust process models able to handle different underwriting, claims, market and
organization practices on different levels (global, regional, country, department).
3. Integration between all back end IT components, online and mobile applications,
gateways to service providers and distribution partners.
4. An agile platform providing self-service change management (products, processes) to
business experts of Insurance companies.
5. Availability of social media integration and big data analytics, integrated with sales &
marketing data and tools.
6. Change management service organization responsible for fast development of change
requests, releases and support of the Insurance organization.
Win-Win solution
The second challenge will be to convince the Insurance companies to outsource their business
to an Insurance IT cloud service provider. A major outsourcing always creates resistance in an
organization, the same as a transformational reorganization. However, Insurance companies
do not have the luxury of time, resources or budget.

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IT SERVICE PROVIDERS TO PLAY AN IMPORTANT ROLE
IN THE DEVELOPMENT OF DIGITAL INSURANCE.
A full Digital Insurance Solution including social media integration, mobile apps, the promise of
fast configuration of products and processes and cheaper execution will be taken very seriously
by the top management of any Insurance Company.
The choice of an uncertain outcome of a big internal program or using an of the shelf flexible
solution reducing the operational cost immediately is no-brainer. The cloud solution has to
include a comprehensive implementation plan ensuring a smooth migration, which takes into
account the status of the Insurance organization, strategic priorities, market & distribution
practices, integration with partners, etc.
Multiple implementation scenarios of the Digital Insurance Cloud Solution have to be available
to facilitate the decision making process and addressing the concerns of Insurance
organizations.
The provider has to be prepared to work intensively together with the Insurance Company to
support business cases, proof of concepts, audits, due diligences, service level agreements and
contracts to help the Insurance Company to get local authority support, headquarter support to
decide on an outsourcing to the Digital Insurance Cloud Solution.
Developing a Digital Insurance Cloud Solution is a win-win situation for IT Service providers and
the Insurance industry where IT service providers focus on the Digital solution delivery and
future innovations and Insurance companies on Insurance business instead of a continuous
internal focus on IT delivery and projects to keep up with ongoing innovations.
IT Service Providers to play an important role in the development of Digital Insurance
Paul de Bruijn
Singapore, October 5, 2015
Version 2
© Paul de Bruijn
www.pauldebruijn.com