Insurance CIOs Say Growth Is Still on the Industry’s Business Agenda

The four insurance company CIOs who spoke at Celent's 2009 CIO Roundtable rated facilitating distribution and leveraging customer information among their top priorities.

Organic growth is not dead -- at least not in the insurance industry, according to a panel of industry CIOs who discussed their goals and concerns at the recent Celent CIO Roundtable in New York. Asked to identify their top priorities for 2009, all four of the executives discussed initiatives related to facilitating distribution, leveraging customer information and capitalizing on market intelligence.

For example, at Conseco, which is targeting low- and middle-income seniors, "The economy is creating new customers every day," Russ Bostick, EVP of technology and operations, told the roundtable attendees. "Growth is definitely on our agenda because we've selected underserved markets. We're focused on controlled distribution." Providing straight-through processing (STP) capabilities "to deliver leads to agents" is one of the ways IT will support this effort, Bostick said.

At Farmers Alliance Insurance, added panelist Andy Edwardson, VP of IT, "Fortunately we see some growth." In a bad economy, he explained, "Everyone wants cheaper rates and starts to look around." For Edwardson's IT team, that means an emphasis on enhancing the proverbial "ease of doing business," and he agreed with Conseco's Bostick that STP is key to integrating the pieces of the puzzle "that will bring business to the table."

Technology also is helping companies such as The Hartford's P&C organization identify niche opportunities. "We're starting to emphasize specialization -- pockets that will be profitable," said Ben Roberts, CIO, commercial lines - middle market and specialty. For example, he told the audience, the ability to focus narrowly has revealed trends such as policyholders changing their deductibles in order to pay lower premiums -- which has implications for product development, pricing and customer retention.

There's even growth in the hard-hit retirement products space. According to panelist Paul Vancheri, SVP and CIO at Fidelity Investments Life Insurance, growth at his organization is tied into Fidelity Investments' "vision of owning retirement in the U.S." The company is exploring ways to broaden distribution beyond its dedicated Fidelity sales representatives, which, Vancheri reported, has contributed to renewed interest in more-sophisticated business intelligence capabilities.

Still there was no gloating or unbridled optimism at the roundtable. Insurance IT organizations may so far have been spared the worst of the economic fallout, but now the pressure is on. Or, as Conseco's Bostick revealed, "Execution will be paramount this year. I want people to be heads-down now."

Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio