Insurance giant Liberty Mutual shifts to cloud to improve European customer offering

Profile picture for user gflood By Gary Flood March 10, 2021 Audio mode
Summary:
“Simpler, customised and faster customer and partner service” being delivered via Liberty Mutual’s new digital insurance ecosystem

Image of Liberty Mutual Insurance logo
(Image sourced via Liberty Mutual )

Boston-based insurance giant Liberty Mutual is the 6th largest property and casualty insurer globally and is number 77 on the Fortune 100 (2019) list of largest corporations in the world. One of its international subsidiaries is Liberty Seguros, which operates as Liberty Mutual Global Retail Markets in Europe, and was formed as part of a major 2018 reorganisation to combine the company's existing Global Consumer Markets with its Business Insurance and Accident & Health organisations.

Liberty Mutual Global Retail Markets defines its mission as to provide simple and customised insurance products and services, with the aim of becoming a top 10 insurance sector player in Europe. And according to its Lisbon-based Chief Information Officer, Alexandre Ramos, a key enabler of that strategy is to move from traditional and complex financial sector platforms and processes to what he sees as a simpler, modular and digital technology processes. 

Upgrading to enable customisation 

Ramos has accelerated this move recently with the adoption of a new digital insurance platform and introduced new possible models for wider technology re-use. This is part of a wider move to drive efficiency and customer-focused digital transformation of business operations. He told us:

Our legacy systems were not flexible enough, leading to significant restrictions with quotes, claims, customer services, and purchases being managed through a range of different processes and technologies.

He politely describes the legacy IT as having "a certain complexity" and Liberty Mutual Global Retail Markets couldn't see an easy way to move to a product approach based on customer needs and preferences. Thus he states: 

Recently, the insurance industry has been focusing on how every customer should be treated as an individual and provided with options to cover their needs. Our technology required an upgrade that would allow more customised products and offer transparency around prices for all possible options. Plus, every project Liberty embraces goes beyond deploying a solution: we are building a digital ecosystem where partners and technology come together in the interest of the customer.

Ramos and his team say they found the answer they needed in EIS, a San Francisco-based specialist in insurance software company that markets a cloud-native platform that enables insurers to grow by realigning their business model around the customer. The vendor had already worked on some main US Liberty Group projects, says Ramos, so emerged as his best option for replacing his legacy core insurance applications.

Extended API capability

The aim: a modern, cloud-based and customer centric IT architecture, Ramos states. Getting to such a position could, the business believed, increase agility and modularity for our customers and partners. Modularity would also be a desirable outcome, he adds, as it would allow the firm to more easily re-align with other key IT providers, especially around pricing.

Ramos says the move is starting to pay off, as his team can now roll-out new products within weeks because of the low-touch product factory capability the new platform provides, while the availability of multiple new services is removing dependency on the legacy systems.

Ramos is also finding value with how easy it is to leverage what he characterises as the platform's extended API capability. Finally, as it is now easier to plug in new applications, he's seeing better integration and improved services much more closely aligned with specific customer needs.

An example is the work that's already happened with the firm's Irish and Spanish Direct Motor channel. There, he claims, a more modular product approach and better pricing capabilities of the platform have been offering customers a much better experience, while time to value is much shorter. Ramos said: 

Products that would take more than a year to create might now take a week, including encompassing the impacts on both the customer journey and all our back end processes. Plus, changes that may have taken weeks before, such as updating a value like a price rule and making it available, can now be carried out immediately.

Ramos adds that the capability of being able to easily link with external pricing platforms means the business can make pricing changes from one day to another and see it reflected immediately across the entire Liberty Mutual Global Retail Markets ecosystem. He adds:

We have also been able to look at customer loop feedback and, with APIs, quickly make changes and improvements in the customer journey.

The right foundation to provide digital services to customers

A strong start, but Ramos says the work is only really just beginning. He explained: 

2021 is a crucial year in our journey and we will continue rolling out new products and lines of business. With the implementation of our new distribution channels in Portugal and Spain, we will also build new components on top of the ecosystem to connect new and valuable external parties. We now have the right foundation to provide digital services to our customers and partners, even during times of disruption.

As well as the core insurance system, Ramos and his team also want to start re-using multiple global services provided by Liberty Mutual Group, moving from in-country local platforms to a global digital ecosystem, while still keeping local market staff know-how.

Ramos also reports that a key lesson he and his team have learned is that business processes also need to be re-engineered through a lean process as part of any digital transformation programme. But ultimately, for this part of Liberty Mutual,

If you aim to remove the restrictions of the past, you need to change both your technology and your business processes.