Systems built by insurers in the late 90s have long since become redundant following the wave of digital transformation the industry has experienced since. As such, insurers need to find partners to help them meet the market requirements of today that will also equip them with the tools to scale successfully in the future.

One such partner is IBA. The company provides a proven cloud native, end-to-end core platform, IBSuite, which is focussed on helping insurers and managing general agents (MGAs) digitalise and automate their operations, particularly for critical components such as claims management, policy administration and product configuration. This allows risk carriers to become more efficient and dynamic amid a changing insurance landscape.

IBSuite

The past 12 months have been an exciting time for IBA and its IBSuite. The company’s global head of sales Niels Trzecieski said interest in its services has flourished as more insurers across Europe and the world are realising that the days of large-scale re-platforming projects are probably over.

“Insurers now find themselves in situations where they have been building their business for many years on platforms and solutions that were available in the late 90s/early 00s, or were bespoke developed by these insurers in the same time period. They have served a good purpose for many years but are for various reasons in need of replacement.”

Given that these business processes have been developed for many years and are deeply embedded in these platforms, Trzecieski continued, it is not that easy to replace them. Some insurers have made attempts with varying levels of success but either way, it is quite clear that such projects come at significant risk and cost.

Hence insurers are now increasingly looking for alternative options. One such path, Trzecieski said, could be for a company to supplement its existing business with more modern, agile and flexible platforms that allow it to “engage in new ventures and pursue new opportunities, without the burden and cost of doing this on your own platforms.

“And that trend is certainly something that speaks in our favour, given that with our cloud native solution allows you to first and foremost coexist with your existing platforms, but also equip you with the ability to pursue new opportunities with a much lower cost and a much higher activity.”

IBA’s beginnings

The company was established in 2010 in Denmark, and now has offices around the world. Trzecieski said the founders were providing solutions to the insurance industry in the late 00s and were looking at the market and wondering if it was working in the best way possible, “at that time, it was still very much traditional software solutions built for on-premise implementation.”

Trzecieski said the founders saw new technologies, such as the cloud, reaching the level of maturity necessary to carry enterprise level solutions. “They decided to start developing a cloud-based solution,” he said. “That’s why we can brand ourselves with pride that we are cloud native, because when the solution was founded and architected it was actually built for provision in the cloud, as opposed to the norm at that time, which were more on-premise classical software solutions.

“That was the gap they [the founders] were targeting, they saw the opportunity to achieve better flexibility and higher agility by using the benefits of cloud solutions.”

Once IBA was founded, Trzecieski continued, it took five to six years for the solution to reach a level of maturity that allowed them to offer the solutions to enterprise-level markets. “Now we have 12 years of experience, 12 years of maturity. And we certainly believe that not only are we catching up to the existing household names, but we are also exceeding those simply because we accumulate new functionality and new features faster than they do due to the agility of the cloud native solution.”

Turning back to IBSuite, Trzecieski said that if a company wants to launch into a new market, offering a new insurance product, or variations of existing products, they can do that on IBA’s platform much faster than traditional platforms.

In its infancy, IBA’s customers were largely smaller insurance companies and startups. This was likely due to the fact its solution was considered new for some years, and it took some time for it to achieve a certain level of maturity that made it relevant for a broader audience.

IBA still had some large insurers using its platform for innovation purposes. In this category, the company counts Swiss insurance giant Zurich Insurance Group as one of its innovative customers. “Zurich has their established business across Europe and the world, but at the same time, they are also driving a range of innovation initiatives.”

Now, Trzecieski said, IBA is moving up in the value chain from small insurers to larger insurance companies who are using IBA’s solution to drive their main business. “They are using our solution for the entire insurance value chain, from product configuration, policy administration, claims handling, and all kinds of financial transactions.”

Embedded insurance

Also in IBA’s portfolio of customers are non-insurance companies that are looking to supplement their existing offerings with insurance products. Trzecieski said, “that could be retailers, who are offering a range of financial service products to their customers such as banking products and insurance products, we have some examples of that.”

One interesting trend IBA is now seeing, Trzecieski said, is that more insurers and non-insurers are looking to offer embedded insurance products. “The concept of embedded insurance is becoming increasingly popular, where non-insurance product providers of various kinds are simply embedding an insurance type product as part of their offering,” he said.

Trzecieski pointed to electrical bikes as an example. Electrical bikes in Denmark are becoming increasingly popular, he said, but they are also quite expensive. Hence to insure the risk of theft or damage to the bike it is common for the shop to offer insurance products in such instances, including replacement or repair services.

This is an insurance offering you now get from your bike shop, Trzecieski said, not so much from the insurance company. As such, he said, IBA is in dialogue with insurance companies who want to get into that business as well as non-insurers who now see this as an opportunity to embed that into their core offering.

The role of artificial intelligence

In the race to digitalise, artificial intelligence (AI) is being increasingly spoken about. With regard to the role it has to play for the insurance industry however, Trzecieski said that although there are pockets of the industry that are more mature when it comes to the use of AI, the industry is “not quite there yet” in terms of taking advantage of such technologies.

“I don’t think that claims handling and customer servicing will be taking advantage of AI in the immediate future,” he said.

However, AI is really useful for considering large amounts of data, Trzecieski said. IBA entered a strategic partnership with enterprise software company Quantev in September 2021 with the goal of combining IBSuite with Quantev’s AI platform, to allow insurers to integrate AI into their claims processes, enable efficient cost containment, and offer quality customer service.

In an announcement at the time Hadrien De March, Quantev’s chief technology officer, said the integration of its AI platform with IBSuite will allow insurers to deal with one of the biggest challenges in the motor insurance: routing customers to the most suitable bodyshops, taking into account multiple variables and large amounts of data.

Trzecieski said although this partnership is not mature enough yet to see the true benefits come to fruition, it is a great example of how insurers can augment their insurance customer service with the provision of other services, in this case providing customers with the best repair service following an accident.

AI is also proving to be useful for image interpretation whereby an image is used to assess the value of contents, or with regard to claims, AI can be used to assess images of damaged cars.

However, Trzecieski hinted that, for now at least, machine learning capabilities are more key in insurance, “Machine learning is very relevant for insurers. If you have access to a lot of data that has a quality and a granularity that is good enough, then there’s a lot of insight that you can gain to help your daily business [from machine learning].”

Machine learning can provide significant value to insurance companies whereby firms can free up resources currently tied up in trivial case handling that could be automated, hence liberating individuals to help customers whose circumstances require a personal dialogue.

Copyright © 2022 FinTech Global

This interview was conducted by FinTech Global as part of the Digital Insurance & CX TechForum event in January 2022.

Posted 15 February, 2022