Archives for January 2009

Push Me Pull You – Soundings from the Model Carrier and CIO Roundtable Events

Remember this character from Dr. Doolittle – the horse that has two bodies, joined in the middle and facing in opposite directions? That is what Team Celent and many our clients did together during the last two days in New York City. We looked back at significant achievement in insurance carriers over the last year with the Model Carrier Awards and looked forward into 2009 during the Insurance CIO Roundtable. If you were not able to join us, here are some of the highlights from the Model Carrier and Insurance CIO events. If you were with us, thank you for your participation!

On Thursday, over 120 people attended the Model Carrier Awards event. This was a recognition of selected insurance IT implementations that delivered significant business results in the past year in areas such as new business automation, data mastery, customer service, IT management, claims and policy automation. Jeff Goldberg, Model Carrier Czar, did an outstanding job of detailing where the chosen carriers excelled in their execution of their deliverables. Thank you to everyone who submitted a project and congratulations to the project teams that were recognized. (The Model Carrier report can be accessed by subscribers on the Celent website

In the afternoon, roundtable discussions provided an opportunity for the attendees to share their practical experience on core systems replacement/modernization and distribution. Based on the amount of note taking going on, many gained valuable insights and some tricks and tips! Also for the first time, the attending vendors had a table to compare their notes and experiences.

In summary, Thursday was a time when participants across our industry reached out and shared approaches to common challenges and opportunities. It was a very interactive, valuable and exciting session.

On Friday, over 100 people assembled for the CIO Roundtable. Donald Light presented the results from this year’s CIO survey. Kudos to Donald for clearly synthesizing and summarizing the pressures, priorities and practices reported from the survey. Here is one example of the feedback: the top business issues for IT in 2009 are growing the business, cost reduction, and ease of doing business. (The CIO Survey report is available at

Following the presentation, a panel of four CIOs shared their opinions and experiences and also looked forward with a few predictions for the year. Craig Weber did a great Chris Matthews impersonation as he moderated the discussions covering numerous wide-ranging topics all related to the execution of business plans in these insurers. Many of the comments involved the special challenges faced given the current economic crisis. The panel shared information about their key initiatives, sourcing strategies, and IT/business compliance. An open question and answer session followed and allowed the audience to probe areas such as system integration, business intelligence/data mastery issues and IT management / process.

These sessions are annual events for the Celent community, so please make plans to attend again, or join us next year as we look backwards and forward at the same time!

5.14.09: Celent Insurance Webinar: Online Insurance Sales and Marketing: What's Happening and What's Next?

Celent senior analyst Nicolas Michellod This event is free for Celent clients and invited guests. Please click here for more information.

4.23.09: Celent Insurance Webinar: Trends in Western European Distribution

Celent senior analysts Nicolas Michellod and Catherine Stagg Macey This event is free for Celent clients and invited guests. Please click here for more information.

3.26.09: Celent Insurance Webinar: Pricing of Policy Administration Systems in Europe

Celent senior analyst Nicolas Michellod This event is free for Celent clients and invited guests. Please click here for more information.

2.19.09: Celent Insurance Webinar: Taking on the Legacy Challenge: A Swiss Insurance Business Case

Celent senior analyst Nicolas Michellod This event is free for Celent clients and invited guests. Please click here for more information.

The Web 2.0. attitude and the insurance industry

When discussing with most of my friends about my job and the insurance industry, I am often told that insurance is not interesting or is one of the least innovative sectors among the financial services industry. Of course, I don’t agree with them and sometimes I have to argue fiercely to demonstrate that their perception is exaggerated. Web 2.0. and its related-technologies are good examples where some insurance companies have already launched interesting initiatives. Based on contacts I have established so far, I have decided to work on a research, whose objectives are to provide some examples of Web 2.0. initiatives launched by insurers and to understand how the sector perceives and evaluates the value of Web 2.0. initiatives in the long-run. While the first objective seems to be relatively easy to achieve, I expect some difficulties with the second one.

In a report published last year called “Capturing the Strategic Value of IT: A Review of IT Investment Evaluation Methods”, I have tried to analyze how insurers can prioritize IT investments and better evaluate the strategic impacts these types of investments can have on their business. Some projects related to social networking launched by insurers are typically the kind of investments, where the question of value is of highest relevance. Of course, entering the blogosphere or a presence in Second Life contribute to launching a signal of modernity and dynamism to potential clients. But do these initiatives really generate new sales or can the new perceived image of an insurer following such initiatives indirectly trigger more referrals? How do insurers evaluate the results of these projects and what factors and criterias are particularly important to them when deciding to adopt the Web 2.0. attitude? Even though insurers’ Web 2.0. initiatives give me some interesting stories to tell to my friends when they tease me about my job and the insurance industry, they do not answer the most important question: what value can they bring to insurers? You will therefore understand that I am very excited and curious to hear what CIOs, marketing managers or other people responsible for such projects within insurance organizations will tell me when I will raise this question! My expectations are high and I hope I will be able to provide interesting findings to my future readers.

Software Application Testing in Insurance, Part III: Test Environment:

Previous posts about testing Topic 1: Automated Testing Topic 2: Getting Test Data Topic 3: Clean, Repeatable Test Data and Test Environment I’ve got a short but important point to add to the previous software application testing topics. A clean test environment makes the difference between valid results and frustrated QA. Running automated or manual tests against the same database over and over cannot guarantee the same results each time. That database changes with each test. I see many insurers who load a database once a week and then have their manual test teams run through a series of scripts every day. When results vary it’s impossible to determine whether it’s a bug or simply because the database contains different data than it did on the previous attempt. It is very important to have a stable, repeatable environment in which to run tests. If a test fails, it’s important to know that the test is failing because of a problem in the code and not because a previous test broke the system. Without a way to easily generate test data and to guarantee a clean environment, different groups that need to test will likely end up clashing in their attempt to utilize the test environment. In a future post I will talk about testing best practices, including more details on creating clean test environments.

1.28.09: Senior Analyst Jeff Goldberg participates in "Avoiding SOA Paralysis" webinar

Senior Analyst Jeff Goldberg will be participating in an Insurance & Technology Vendor Perspectives WebCast: Avoiding SOA Paralysis: Cutting The Costs of Mainframe SOA for Insurance Date: Wednesday, January 28, 2009 Time: 9:00 AM PT / 12:00 PM ET Duration: One Hour More information is available here.

Celebrities meet insurance: Is insurance really that cool?

It is January when Christmas parties are over, belts a little tighter (metaphorical and physical) and you’re running out of recipes for the re-use of Turkey. Here in the UK, the television schedule can often be relied upon to cheer you up with festive specials of your favourite show (and who can forget the hypnotic draw of the Queen’s speech). What one doesn’t expect is to be entertained by adverts for insurance.

I will make a confession to having a little soft spot for the mascots of UK insurance television ads with the notable exception of the talking bulldog who makes me channel swap with alacrity. The animated phone (who now has a cute little friend when selling pet insurance) and the dapper little blue mouse who has unlimited energy and enthusiasm all bring a smile to my face. Do they make me buy insurance? Well, I’ll leave that to the marketers to debate but I will concede that these cute little tykes do help keep the brand on top of mind at renewal.

Not to be out-done by the compelling seasonal schedules of BBC, or perhaps because of these schedules, a handful of the top insurers have splashed out on celebrity based ads. Aviva has outdone themselves and have several big names including Elle McPherson, Bruce Willis, Alice Cooper, Dame Edna, Ring Starr to support the company’s change of name (from Norwich Union to Aviva). Each celebrity poses the question as to whether they would have been successful had they not changed their name. Enough said.

Direct line, Esure have made similar investments in UK celebrities – notably Julian Barrat, Paul Merton, Michael Winner. It is the new advert from Swiftcover with an exuberant and semi-naked Iggy Pop that is the most startling to watch. Does such a pop icon really buy insurance at all, or even on line? Don’t famous people have people who do those sort’s of things? (If you have time on your hands and need a giggle in the dark months of January, check out Iggy Pop dancing to entice you to buy Swiftcover –

Perhaps the choice of celebrities tells us more about the target buyers than the insurance product. With the exception of the Aviva advert where the celebrities could arguably have a broader generational appeal, the other celebrities would suggest the insurers are targeting the baby boomer rather than the generation X’er. This may be a sensible marketing move betting on the fact that the mid-generations will continue to buy insurance in this current climate whilst the generation X and Y’s, who look to be most severely hit by the redundancies, will not be active buyers. Was this prescience on the part of marketing or another pandering to the celebrity culture that envelops us.

But back to the question of insurance and the coolness factor. When the Beckham’s, Paris Hilton, Gordon Ramsey or Prince Harry are enticed to smile and dance for a UK insurance brand, will that surely be the time to declare insurance as the ultimately cool product. Until then, and certainly for 2009, we will have to comfort ourselves with the dulcet tones of middle-aged UK celebrities doing their best to make insurance cool.

In the Comfort of Your Own Home

So, here is something you can do in the comfort of your very own home.

The next time you are watching TV for a couple of hours, watch the commercials. Don’t leave the room, or channel flip, or check your email—just watch the commercials.

And as you’re watching, keep track of the number of commercials that feature a person who is physically unattractive, or not very bright, or doing something ridiculous, or often all three. Oddly enough, this person is usually in cast in the role of an actual or prospective buyer of the good or service the commercial is advertising.

I’ll bet a shiny new quarter that you’ll be surprised at the number of times you spot this character. Not in a majority of commercials by any means, but in a noticeable portion.

I’m not a big expert on advertising, but I do remember from business school that the general idea is to get people to try, buy, and continue to use whatever is being promoted.

So why would a commercial show a buyer/user of its product in such an unflattering light? I don’t know. Strikes me as quite weird. Maybe it is a triumph of the need of the people making the commercial (and the people who are sponsoring the commercial) to demonstrate that they are much more cool than the poor schlubs who actually might buy the thing begin advertised. (See my earlier post, “The Meaning of Cool.”)

I would be happy to say that these kinds of commercials are never, ever run by insurance companies. There are certainly many counter-examples: the commercials run by State Farm, or Allstate, or Liberty Mutual, and others.

But, it pains me to say, there are a few insurers whose commercials do view their policyholders and prospects as rather unattractive folks.

Two words to the insurers running those commercials: please stop.