The insurance industry, which probably has more legacy mainframes per square inch than anywhere else, has a reputation as a conservative industry. However, a new report out of Insurance Networking News finds insurance companies may be on the verge of an SOA revolution.
In a Q&A with Mark Gorman, analyst with Tower Group, Gorman observes that "iInsurance carriers are increasingly looking to the promise of BI to help them make more precise, more accurate, more consistent and more timely decisions across a wide array of business processes. To do so they are enhancing their capabilities at capturing, analyzing and utilizing data."
SOA enables BI services to be made "potentially available to any person, process or transaction regardless of the timing, location or type of transaction being executed," Gorman said.
Gorman's associate, David West, elaborated on this convergence taking place between BI and SOA: "In addition to improvements in consistency, accuracy and timeliness of decisions, a key value proposition of SOA for BI is its financial return," he said. "Service-oriented BI systems carry a lower total cost of ownership. This architecture enables organizations to optimize their use of hardware so that components of BI systems run on the platform that makes the most sense from a cost/performance perspective."
Areas where BI services are being employed include marketing applications, such as lead generation or lead assignment, product selection for cross-sell or up-sell opportunities, or channel selection for new product offers, Gorman says. Other areas include automated risk assessment and pricing precision capabilities during new business, and renewal application processing.
While I agree that a service-oriented approach to delivering insight is very effective, I am not sure I would call every aspect of this "BI". Much value comes through the construction of decision services into which you can inject analytic insight. As I said when I blogged about Karen Pauli's work in claims (Karen is a colleague of theirs at Tower Group), calling this BI may not be helpful.
JT
As a former Corporate Planner of two insurance companies (OneBeacon Insurance & The Home Insurance Company) I agree with your comments 100%.
Terminology is the last hurdle insurance companies need to overcome before they reap great rewards from business intelligence. Business intelligence to business professionals means information about: their lines of business (such as commercial auto, home owners insurance, term life insurance, etc.); customers; competitors; business partners and channels (including banks, brokers, MGAs, and independent agents); and vendors.
BI terminology to IT professionals extends from linking data warehouses to dashboards to on-demand information services from companies like Business Objects.
The terminology is further complicated because most large insurance companies have many subsidiaries with different names that are left over from prior acquisitions or current regulatory reasons, and each legal entity is often also labeled a line of business.
Using clear terminology, comprehensive BI SaaS for insurance will be a big winner. Without the proper framework and correct technology, duck!
Alan Michaels, co-founder
eCompetitors.com
Providing information on over 9,000 industries