Innovating insurance through the power of API-led connectivity
But, unlike banking, the t...
With $135.7bn in global investment, Fintech is clearly one of the most attractive sectors for disruptors and innovators.
But, unlike banking, the traditional Insurance industry proved itself to be more resistant towards disruption, which is not surprising, since one needs volume and scale for the probability models to kick in. In the end, it’s math and actuarial science that make it possible to earn on risks.
Mathematics, on par with industry regulations and all-pervading market coverage by industry “old-timers”, creates high entry barriers for new players. Ironically, the same factors also prevent traditional Insurers from showing significant YOY growth. This means that the companies need to optimise costs, find new market segments and offer personalised services that appeal to customers to stay profitable, and digital transformation is critical in delivering on these goals.
“Traditional business models are being challenged and not by innovation in insurtech per se, but by technology shifts in other industries”, says Mike Randall, CEO at Ricston (an IT consulting company working with fintech). “Let’s take automotive, which was traditionally hard to disrupt. Technology innovation and the increase in IoT led to the ability to gain far more data inputs from vehicles. Given an ability to connect with these data sources, one could better assess risks and therefore drive premiums to the most relevant demographic“, he explains. “That’s a significant opportunity for insurance companies, allowing them to offer competitive rates, but also causing the industry to rethink their technology stack. Some of our clients recognised the need for such digital transformation early on and turned to an API-led connectivity approach, harvesting the first results today ”, Mr Randall concludes.
For instance, multinational insurance provider Zurich Insurance is utilising the benefits of an API-economy by creating easy to use, purposeful APIs for their partners and customers to integrate their risk management systems and share data and information together.
And it is not only B2B integration that can benefit an insurance company. APIs can also be used internally to connect backend systems to streamline business management processes and raise efficiency across all subsidiaries worldwide.
"When you operate a diversified global business obtaining a 360 degree view of your customer base is very challenging", explains Kevin Jervis, CTO at Ricston; he continuous, "risk profiles and calculations associated with insurance products, and therefore, quotes and prices will vary depending on which geographic region of the business is handling an account, furthermore, subsidiaries may use different back-office systems". Jervis argues that "one of the solutions is to create a micro-services architecture to enable a common CRM to 'source' data from disparate systems and streamline federated quote-to-cash processes; for instance, the broad connectivity and data sourcing capabilities of MuleSoft's Anypoint Platform are being successfully utilised to enable process automation and end-to-end visibility in Salesforce today".
Public insurance companies, such as icare, are focusing on unlocking their legacy systems and radically redefining end-user experiences to meet mobile-centric market demand. Kevin Jervis explains that this is also achieved with an API-led connectivity approach, “where APIs are used to wrap the core system complexities and enable the orchestration of processes to expose the required data to the consumer”.
Meanwhile, shifting global economics and demographics, rising customer expectations and changing digital environment cause significant challenges and create additional pressure for the companies to become more adaptive.
“The need to adapt and adapt fast becomes crucial for traditional finance industry stakeholders, we’ve put our bet on API-led connectivity approach and are working towards achieving a composable enterprise vision ”, says Mr. Randall.
For more information on all topics for FinTech, please take a look at the latest edition of FinTech magazine.
Check Point: Securing the future of enterprise IT
Cybersecurity solutions provider Check Point was founded in 1993 with a mission to secure ‘everything,’ and that includes the cloud. Conscious that nothing remains static in the digital world, the company prides itself on an ability to integrate new technology with its solutions. Across almost three decades in operation, Check Point, with its team of over 3,500 experts, has become adept at protecting networks, endpoints, mobile, IoT, and cloud.
“The pandemic has been somewhat of an accelerator in the evolution of cyber risk,” explains Erez Yarkoni, Global VP for Cloud Business. “We had remote workers and cloud adoption a long time beforehand, but now the volume and surface area is far greater.” Formerly a CIO for several big-name telcos before joining Check Point in 2019, Yarkoni considers the cloud to be “part of [his] heritage” and one of modern IT’s most valuable tools.
Check Point has three important ‘product families’, Quantum, CloudGuard, and Harmony, with each one providing another layer of holistic IT protection:
- Quantum: secures enterprise networks from sophisticated cyber attacks
- CloudGuard: acts as a scalable and unified cloud-native security platform for the protection of any cloud
- Harmony: protects remote users and devices from cyber threats that might compromise organisational data
However, more than just providing security, Yarkoni emphasises the need for software to be proactive and minimise the possibility of threats in the first instance. This is something Check Point assuredly delivers, “the industry recognises that preventing, not just detecting, is crucial. Check Point has one platform that gives customers the end-to-end cover they need; they don't have to go anywhere else. That level of threat prevention capability is core to our DNA and across all three product lines.”
In many ways, Check Point’s solutions’ capabilities have actually converged to meet the exact working requirements of contemporary enterprise IT. As more companies embark on their own digital transformation journeys in the wake of COVID-19, the inevitability of unforeseen threats increases, which also makes forming security-based partnerships essential. Healthcare of Ontario Pension Plan (HOOPP) sought out Check Point for this very reason when it was in the process of selecting Microsoft Azure as its cloud provider. “Let's be clear: Azure is a secure cloud, but when you operate in a cloud you need several layers of security and governance to prevent mistakes from becoming risks,” Yarkoni clarifies.
The partnership is a distinctly three-way split, with each bringing its own core expertise and competencies. More than that, Check Point, HOOPP and Microsoft are all invested in deepening their understanding of each other at an engineering and developmental level. “Both of our organisations (Check Point and Microsoft) are customer-obsessed: we look at the problem from the eyes of the customer and ask, ‘Are we creating value?’” That kind of focus is proving to be invaluable in the digital era, when the challenges and threats of tomorrow remain unpredictable. In this climate, only the best protected will survive and Check Point is standing by, ready to help.
“HOOPP is an amazing organisation,” concludes Yarkoni. “For us to be successful with a customer and be selected as a partner is actually a badge of honor. It says, ‘We passed a very intense and in-depth inspection by very smart people,’ and for me that’s the best thing about working with organisations like HOOPP.”