Insurance Technology Summit Q&A: Equinix global head of insurance James Maudslay

Ahead of the Post Insurance Technology Summit, Post editor Stephanie Denton sat down with Equinix global head of insurance James Maudslay to discuss the role inter connection and ecosystems play in giving insurers a digital edge.

In your Digital Playbook for insurers you talk about the need to “cross the chasm” to become a digital insurer. Can you explain what you mean by that?

Equinix global head of insurance James Maudslay: “Until now, insurers and many other financial services businesses have been trading in what you might describe as an analogue way. In other words they have had central points for the storage of data; and central points for calculating whatever it is they are looking at.

“But now things are changing; and there is a need for people to behave in a digitised way. Which means they are able to exchange data freely among themselves, with their partners, with their customers, but also to move data to where it is really needed - to where people use it, what you might call the digital edge.”

So how can insurers bridge that chasm from where they sit today, to where they need to get to in terms of becoming a digital insurer?

Maudslay: “There are two key words that relate to this. The first is inter-connection, and the second is ecosystems.

“Now, under their old ways of working electronically, the service [insurers] had was focused on the internal side of the company, so if you received some data you would then add it into your stack.

“What is now happening is that delivery of information is very much automated and that requires interconnection. Which means that a company is physically able to interconnect to partners or third parties so that data can [not only] be sent to them, but it can also be sent back to a partner or third party.

“And this brings us onto the concept of ecosystems. Insurers have been part of one of the largest ecosystems, but it has been a social face-to-face ecosystem. Now they need to be part of a digital eco system where they can receive and share information and data with different parties. And this has to be done by interconnection.

What benefits should insurers see by building an interconnected digital platform?

Maudslay: “There are several. The first of which relates to cost. Now there have been popular misconceptions that doing things in a contemporary fashion can immediately reduce costs, but that isn’t necessarily true. But through interconnection and the work we and others are doing in this area they can certainly reduce connectivity costs - and increase its flexibility.

“The second point concerns partnerships and this refers back to ecosystems and the growing [one] that exists within insurance. So partners are vital to [insurers’ futures]. Partners can deliver expert services to them; partners can enrich the products they sell; and partners can perform the jobs that insurers perhaps should not necessarily be doing themselves. And the principle of interconnection is what allows you to access those partners wherever they maybe cheaply, securely and effectively.

“Finally, there is the whole area around insight and analytics. Insurers have long been long been significant users of analytics but now the use of it is becoming more immediate, more focused and [better] directed at the people they are trying to serve, the end users.

“So customisation becomes vital. [Because] customers now expect you have great insight into what they are doing, what their needs are and - dare I say it - predict what their needs might be in the future. And that is another area this is really driving change in the insurance industry.

So finally, what are the most important things viewers need to do to start doing, in order to map out a path that will deliver the ambition of being a digital insurer?

Maudslay: “I think there is a path insurers can follow and hopefully it is a relatively simple one. And it all begins with their network. Their networks are currently typically ones that carry information to and from a central point dedicated to the service of that company.

“And that is working well at the moment, but is not going to serve them well into the future. The future network must take into account the use of cloud computing; it must take account of the fact they will have to consider the use of the digital edge - and what that actually means for them. They also need to take into account security as part of their network. Traditional security solutions will not serve the digital edge and the enlargement of their network properly.

“The next part is that they need to consider where they are going to store their data - and as we all know there are endless considerations in terms of data protection. But it is has to be secure, it has to safe, it has to be compliant and has to be usable so it can serve the need where it is required.”

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