Fast-tracking an agile solution for managing Group Life Insurance corporate plans
“It’s this flexibility of Axelerator – and the Axe team – that I like best. Their agility.”
By Martin Stewart : 10th of December 2018
Group corporate plan insurance policies are by their very nature complex. While the plans may have a common framework, there are hundreds of major and minor variations in the master policy definitions that include Death, TPD and IP, as well as combination covers like Death and TPD.
Traditionally the group insurance industry has supported and managed hundreds of corporate plan schedules using just documents, pdfs and spreadsheets. This made for a highly complex and laborious process with limited ability to perform complex financial calculations, avoid manual mistakes, or leverage data insights. For one of Australia’s largest financial services companies, these manual processes were increasingly compromising their ability to serve their customers effectively, triggering a search for a new solution.
This wasn’t as simple as just buying an off-the-shelf software solution. According to the company’s Senior Group Insurance Manager, the product they were looking for had never been implemented before. ”The industry has never had a system before that actually caters for a plan that is owned by a corporate entity that may have 200,000 members underneath it.”
The company wanted to automate as much manual processing as possible to eliminate the chance of errors as well as to put in a documented process that could be audited. They also wanted to be able to add new plans as well as amend and maintain these plans themselves rather than having to rely on external development support.
“Our legacy systems were a massive problem, so we decided to begin anew with this new system. When we started this project, we went to a multitude of vendors and told them what we were wanting to build, with the caveat that there wasn’t the budget for a full product administration system. We decided we would slowly build it out year by year and eventually decommission our older product administration system.”
So, with an eye to starting fresh, they turned to Axe, who had previously built the company a new business portal. “Axe had built another system for us that had been designed to improve customer experience and reduce manual processing, which was working pretty well.”
The biggest challenge though, was that the solution needed to be delivered within six months.
The tight timetable meant the project had to run in full Agile mode from day one. As it proceeded many subtle variations were found hidden within the spreadsheets, which meant that the requirements rapidly evolved over the project’s life. To account for this, Axe ensured that their full R&D team was available to update Axelerator as soon as the project identified new requirements.
“We chose to run this project as an Agile project. I don’t think we anticipated though how much we’d be building on the run – but Axe has been able to cope with that and has been really resilient which is helpful.”
To keep the process moving, Axe delivered new testable functions to the client every two weeks. And in the end, the solution was built in less than six months, which included many enhancements to Axelerator to support the new requirements discovered during the project.
“What we like about Axe is the fact that they are quite agile and are able to turn products around quickly.
One of their other strengths is they have a lot of permanent staff – if they find someone good, they keep them.”
Using Axelerator’s Adaptive Hierarchy, the Axe team created definitions for all the possible options for each category of plans. A rules-driven configuration panel was built to allow the options for each individual plan schedule to be set. These rules included 7 different premium formula options for both unitised and fixed sum insured and for insurance paid for by the insured super account and non-super cover.
This setup enables a new Policy Definition to be created for each plan schedule that includes details such as the name and address of the corporate, the covers available, the maximum and minimum sum insured value, the rating table, and the options available such as waiting period and benefit period.
Once each new plan is set up, a trial upload of the spreadsheet can be done to validate the data in the spreadsheet and test out the rules. The upload can expose any missing or incorrect product definition rules, missing or incorrect data in the spreadsheets, and errors in the product ruleset itself. Uploads can be easily backed out so that errors can be corrected, and the data reloaded.
All the changes to the Policy Definitions over time are recorded along with start and end dates so there is a record of the entire plan life cycle. This means claims and cover changes are always able to reference the correct version of the rules based on the effective date of the individual’s policy.
The business now has a solution that caters for all types of plans across new business, renewals, lapses, cancellation, and mid-term adjustments as well as premium and tax calculations.
“We have put this new system in, that includes a whole financial module, a member’s store, and a lifecycle piece with the view that from next year we will be able to install all our plans onto that system. We don’t believe anyone’s built anything like this in the industry.”
“The important thing with this system was to be able to install every plan onto it regardless of how complex the product was, and every member that we manage. The hard bit is what we’ve built now. The bells and whistles – the cheap bit really – we can now add on.”
In terms of business benefits, automation of a previously manual and error-prone process is resulting in efficiency and quality gains. “My team are saying “Oh, annual reviews are going to be so much quicker”. If I quantify that out, it is probably something like a 75% improvement in efficiency to complete an annual review. That’s going to free my team to do things that are more proactive.”
The efficiency improvements won’t be limited to the business either. “Imagine a system that an adviser, a member or an employer could go to to lodge a claim, through which we could do an active member check automatically – it would take 3 days off the time it takes to process a claim.”
“The system is catering to all types. In an ideal world you’d probably consolidate your portfolio before building a digital system, but what we’ve built will cater for different owners, for super funds, non-super funds – we actually have built all the variation we need in the tool, now.”
“Today we can load all the plans into the system ourselves but it has the ability to be enhanced in the future, so we can provide greater visibility to much wider circle of users.”
“It’s this flexibility of Axelerator – and the Axe team – that I like best. Their agility. You don’t have all the bureaucracy which means you have the ability to get stuff done quickly, which is great.”