Insurance Edge spoke to Bart Patrick at Duck Creek Technologies to learn more about how data ecosystems can truly transform insurance companies.
IE; Lots of companies have adapted rapidly to working from home, more video calls and so on, but are there sectors within insurance that still need to change a bit quicker?
BP; The biggest challenge is probably the London market and all its ingrained history. There is still a great reluctance to change the way of doing things that’s been around for 300 years or so. Equally, there’s a great deal of caution there when it comes to upgrading IT and software, a feeling that it’s intrinsically important to `own’ something, to see green lights winking on the servers each day.
I would say that overall there’s been a massive investment in tech over the last few years, but it isn’t all money well spent. We have seen some companies endlessly bolting extras on top of a legacy system, I mean if you go deep enough in some places you will find monitors with green screens – seriously!
IE; Nah, they’re still using an Amstrad 464 – no way!
BP; The thing is that I can understand it in some ways because someone made a huge investment in a new system at some stage, so it looks better on paper if you upgrade, add-on, tweak things a bit, rather than write off the entire thing and start from scratch.
IE; What do you think are the key lessons that have been learned from Covid-19, right across the industry?
BP; It’s been the ultimate stress test, hasn’t it? The way that most insurers, brokers, and MGAs are still functioning through all of this, while setting up home-based systems for staff, dealing with policyholder complaints and admin etc. is incredible really.
From that, the big lesson I guess is that companies need to ask themselves what if our Cape Town partner goes into lockdown, or an Indian outsourcer can’t function, where’s the backup plan for the future? The more your system is glued together, like a large Jenga tower, with extra layers added on from all over the world, then the more vulnerable you are to a collapse if one crucial brick is removed.
IE; All those links in a chain of data, utilising third party suppliers, also increases the cyber risks too doesn’t it?
BP; It does; likewise, working from home indefinitely also raises the risks of people shoulder-surfing your staff, or accessing their devices. It’s impressive that insurance has so many honest people within the sector and there haven’t been huge data breaches reported as a consequence of Covid-19 home-working – but that’s not to say it won’t happen at some point in the future.
IE; How has the Covid-19 outbreak affected Duck Creek?
BP; Touch wood, we haven’t missed a beat, and that’s partly because we are already working via an ecosystem with some staff working remotely and plenty of backup plans in place. Like any company, we have core applications that are robust, especially in terms of distribution of data and workflow.
That’s the key to recovery after Corona really; building a system that effectively analyses, distributes, and backs up data as a matter of routine. If insurers can take the plunge and create something like that, then they’ve got a flexible software package that matches the vibrant feel of the office. It’s great to have good people working together, creating a culture of innovation, trying new ideas and so on, but you need an ecosystem that makes all that creative stuff into real-world products that actually work for the consumer.
IE; Consumers are used to buying insurance online, so working out how to make it better is probably crucial to your next 300 years in business?
BP; Yeah, definitely. You know, I have a favourite word when I look at lots of insurance company software and it’s this; stodgy. Too much thick, stodgy stuff clogging up systems. We need to build things that are helpful for consumers, really easy to use – then they will WANT to use them, right? The problem with lots of new insurance apps is that they end up taking a really simple idea and destroying its appeal in all the stodginess. People don’t want to learn your software just to buy a service.
IE; Where do you see the growth areas in 2021 and beyond?
BP; There are some great MGAs out there now doing interesting stuff, bringing new ideas on rapidly, and distributing that new thinking on the way. I think there could well be a major cyber event in the near future, which will really transform cyber insurance. People will ask what it is really for, how can it be made workable in the face of a major threat? In itself, the event will probably bring about demand for a new range of insurance products too.
IE; Interesting stuff Bart – thank you for your time.
Add your thoughts on Covid-19, the impact on insurers and the path to recovery, vai this Duck Creek Global survey:
COVID-19 and Insurers: Is it business as usual or business badly disrupted? https://www.surveymonkey.co.uk/r/F9SM67C