An Always-On Business
United Property & Casualty Insurance Co. (UPC, St. Petersburg, Fla.; about $208 million in annual written premium) aspires to be the premier provider of catastrophe-exposed property insurance, but it saw an opportunity to improve its own catastrophe risk mitigation posture in 2010, according to Andre Nieuwendam, director of IT, who joined the company that year. In March 2012, the provider of homeowners, dwelling and fire insurance switched its infrastructure from a combination of BPO and internal capabilities to a private cloud arrangement with External IT (Dallas). "With the exception of our thin-client-based desktop operating systems and our mobile devices, every aspect of our operation runs in the cloud," Nieuwendam comments.
Business continuity and disaster recovery capabilities were at the top of UPC's concerns about its value proposition and differentiation in the marketplace when considering a move to the cloud, according to Nieuwendam. "We still had a colocated facility 20 miles down the road from our headquarters, and on the same path of uncertainty should a storm impact us directly in the Tampa area," says Nieuwendam. "We were managing our own environment, so we were susceptible to hardware failures. We had a couple of minor events within my first six months here that convinced me that we were on the wrong course in terms of being able to support our insureds and agents in the event of a business disruption."
UPC's evolution to the cloud has its roots in a move it made about five years ago from a West Point Underwriters (Pinellas Park, Fla.) Web-based policy administration system to becoming a full CSC business processing outsourcing customer. UPC remains a CSC customer, using the Falls Church, Va.-based vendor's Point In Java-based policy administration system, Advanced Claims, and its AgencyLink quote-and-bind system. However, UPC embarked on what Nieuwendam characterizes as a hybrid of the old and new.
"Our long-term strategy with CSC, now that we're reaping the benefits of the cloud, is to take some of the responsibilities from the vendor and do a more hybrid version of managed services that will give us better control of our reporting and the ability to be more nimble when doing things such as rate filings, implementing new state programs, etc.," he explains.
UPC is also bringing another data center online to reduce hardware costs paid to CSC and facilitate greater control of data. There are things UPC can't do since it's dealing with a service provider that's a government contractor and has to adhere to robust security requirements, Nieuwendam says. "We have initiatives in play that require our getting our hands on our data better than we could in the past," he says.
For example, UPC is moving to a single-source reporting platform using iPartners software (Alpharetta, Ga.). "The challenge has been getting all the data we need into iPartners," says Nieuwendam. "As we put more of the policy management into the cloud, we'll have access to all the related data sources rather than having to send a monthly dump file into the application, as we currently do." -- Anthony O'Donnell
Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio