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Innovative Software Configurator for the Insurance sector

Periodic Reporting for period 1 - i2S-IC (Innovative Software Configurator for the Insurance sector)

Reporting period: 2016-11-01 to 2017-02-28

The insurance sector is on the verge of disruption. Years of stagnation on adoption of state-of-the-art technology have fostered a multi-threat environment in which those historically most established find their business model is at risk from players who can adapt, scale and better response to customers on top of optimized technology. While a range of solutions exist in the market aiming at replacing insurance companies’ core systems, little take into account the key hurdles in replacing legacy systems, often resulting in high risk low return projects or becoming new legacy themselves, because they fail to separate business rules from technology transactions.

This situation also affects user satisfaction, as it is widely reported that, due to their technological limitations, insurers are failing to deliver quality service to new consumers, whose necessities don’t align with the service offered by current insurance IT solutions.

The overall objectives of I2S-IC include addressing the obstacles to rapid market facing change created by legacy systems, creating immediate business value, and prepare for legacy replacement by dealing with the most serious issue head on: business knowledge.

After completing the study on the feasibility of the project, we conclude that i2S accounts the resources and background necessary for overcoming the identified technical and cultural barriers.
The specific objectives for the Phase 1 execution were:

TECHNICAL Feasibility
Analysis of the necessary developments of i2S-IC so as to ensure the technical proof of concept of each component. Software requirement compliance review, IT and insurance standard conceptual validation and optimization plan to be implemented during project execution and detailing of the involved tasks, including risk analysis, as well as a contingency and mitigation plan.
Assessment on the specific characteristics of the market, segmentation and on a tentative exploitation strategy and target market selection. Identification of competitors and competing solutions, regulation applicable to the insurance sector, and analysis of the social environment. Freedom-to-Operate (FTO) and commercialization risk analysis.
REQUIREMENT sourcing & showcase results
Analysis of the actual customer needs with respect to the identified market by means of a dedicated survey to insurance companies and other organizations with a key role in the insurance industry standards. External consultant report on the range of necessities in the insurance market that i2S-IC covers.
Financial feasibility analysis of i2S-IC, including cost and pricing strategy. Compiled financial risk analysis and concluding funding requirements.

Over the last four months, a series of activities have been carried out in order to assess the project’s viability in the aforementioned aspects, including:

• Technical assessment on the technical feasibility and risks involved in key development factors in the next implementation steps, including the suitability of the project to going cloud, the cloud platform type and vendor selection, whether or not available frameworks exist that enable transitioning from a standalone to a web/cloud architecture, and finally, the grade of coincidence between the ACORD standards and I2S-IC.
• A thorough analysis on the main market trends and needs, including regulation, emerging business models and barriers, was carried out. Macro-economics are also considered and compared with the evolution of insurance market for selecting target markets for i2S. As of the conclusions of this study, a market entry agenda is proposed, together with a commercialization strategy which includes a Freedom-To-Operate analysis and the subsequent IPR strategy, commercial risk assessment, and a detailed analysis on comparable solutions to i2S in the market.
• As of the activities carried out for gathering user requirements on insurance IT solutions, including a preparing a showcase, we itemize the main findings and assess their feasibility w.r.t. their viability and adequacy to be featured in the final product.
• Cost & price strategy development, and financial forecast considering the reach of our distributor network.
i2S addresses the limitations of current solutions in the marketplace in the selected countries, as it is the only solution capable of bringing insurance product to market in one month, but also because it tackles with the heavy legacy system presence in the infrastructure of currently operating carriers. In comparison with state-of-the-art solutions, only I2S-IC provides integral cloud-based product configuration with catalog and quote service and legacy system ease.

Our plan is to launch in our home market and then extend to the countries more accessible with the aid of our customer and distributor network, namely in the EU and Latin America. While the former holds the biggest market share in insurance by written premium, the latter accounts an extraordinary growth forecast in the next 10 years.