André Symes from Genasys Technologies explains what APIs are and what brokers and insurers need to think about when starting their digital journeys.
For those of you obsessed with all things Strictly It Takes Two, don’t worry. I’m not about to show you how to tango – I know my dancing limitations! I’m talking about software demos.
The rate at which insurance businesses are automating different areas of their operations is gathering pace. If you thought that advances made in 2018 were significant, just wait until next year.
Much of the innovation that has taken place to date has been focused on personal lines. I think that next year we’re going to see companies of all shapes and sizes across the gamut of the industry fully embracing the digital world.
For many, whether a long established player or a start-up, it means turning to a third party like a software house to help them progress their digital journey or get their new idea to market.
If you are buying a commercial off-the-shelf proposition from a large, well known company, this is pretty straightforward. If you are looking for custom software however, it’s not quite so simple.
Time is of the essence in any project and many may well promise quick time to market, but it is worth confirming the definition of ‘quick’. Okay the insurance industry is not renowned for being the most fleet of foot – however would you define 18 months to go from a standing start to launch as quick?
Functionality is a massive component to consider. We all know how easy it is to get carried away when pitching for business – but does the vendor really have the functionality features that it promises?
This is particularly true when it comes to one of the latest buzz phrases – APIs. For those of you don’t really know what an API is, perhaps a simple analogy can help explain.
Think about a rail network. Trains move people and goods from one point to another but a lot of route planning is required upfront, clearly defining the start and destination and all the stations to visit along the way as well as the infrastructure needed such as tracks and tunnels.
An API publishes certain end or access points – think tracks and stations – that can be consumed by other systems. So when software platforms are defined, certain of their core functions are published via an API to allow external systems and platforms to leverage internal functionality and interact.
Unfortunately, they’re not all equal. If you can build tracks and stations that are generic and can dynamically change to accommodate any train, you put yourself in a great position for possibilities down the line.
If your tracks can only accept certain trains, you need to change the tracks each time you want a new train. This is what is known as “hard coded API”, and if it sounds like a pain, that’s because it is.
It is important to ask any vendor about the depth of their API suite. While having one or two end points does mean you can say you have an API, in truth this is so limited that it offers little real value.
You need to have access across a range of functionality from quote and bind all the way to first notification of loss to claims fulfilment and management information system reporting.
Also functionality alone can’t just tick the API box. It’s important to ask about the type of API. Having something that is not documented and hard coded will probably end up causing more problems than it solves.
Generic, self-documenting and dynamic suite APIs are the solution if you truly want to leverage this business enabler.
There’s one easy way to get the answers to these questions, and that’s to ask the software house concerned to present a working demo.
There is a danger that a vendor may be building its products on the fly, and it is the client who is basically funding development.
This is a massive risk for any business, but particularly for smaller enterprises and start-ups, as the development could take a huge bite out of their operating capital while their new system is being built.
The digital transformation taking place in the insurance industry is truly exciting – but to deliver a successful project or bring a new product to market, it takes the right dance partner.
André Symes is chief operating officer of software house Genasys Technologies.