Insurance Solutions – The House of Mirrors


Every time I peruse anything dealing with insurance technology, I come upon the term “Insurance Solutions.” I guess insurance solutions is a category for anything and everything related to insurance-technology. So, all insurance tech is in the insurance solutions bucket. I do get that, but any technology that is insurance related isn’t necessarily a solution. Or is it?

Maybe I’m a heretic in the Church of Insurance Solutions, but enough already. The overused word “solutions” comes from the sales side of the world that decided that you would sell more widgets if you called your widget a solution.

The buyers of technology really liked thinking they weren’t buying a product or a service, but a real genuine solution that would make business problems disappear. Unfortunately, it doesn’t necessarily work that way. Say you are tire-kicking for a new claims system or policy-administration system. Every vendor is touting their SOLUTION as The One that solves your problem. With a few dozen vendors hunting for your business, who are you going to believe?

You only get to where you want to be by knowing what vendors are selling. To fully understand what vendors have deemed The Solution is for you to invest time and resources to find out which vendor is telling the truth. That gets us to the Request for Information (RFI) or the Request for a Proposal (RFP). I’m not going to get into the RFI/RFP process, as that is for another day, but the only way to separate the wheat from the chaff is to take the time to see who has what.

Last year, I listened to the hype that a well-regarded long-time policy-admin vendor had and sat through a full demonstration of the application. It was a solution all right, but it was a solution that time had passed by a decade ago. You keyed in information into an Acord lookalike screen. Ten minutes into this demo I could see that this was the solution time forgot: the Jurassic Park of insurance technology. Just so you know, I consider manual data entry to be something you only do in a limited way. If I am setting up a new policy file, I expect that most of that information is readily available through third parties and I can simply import that information through a digitized document or a direct feed. After all, in most jurisdictions, you can tap into public records and quickly access homeowner information such as year built, type of construction, number of bedrooms, bathrooms, total square footage, and a ton of other information that only needs to be plugged into the new system. (I wrote about the use of this technology almost 4 years ago in a white paper titled “Distribution Modernization” which is still on our website).

But suffice it to say, this particular solution wasn’t much of a solution and probably created more process-oriented problems than it solved. Which goes back to what I said earlier: all solutions aren’t created equal, and many don’t solve anything. But “delivering solutions” has such a nice ring to it. Doesn’t it?


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