Insider view: harnessing technology to grow an insurance business

Our ‘insider’ series explores the challenges, pitfalls and triumphs of bespoke hosting projects.

Organisation: 1st Central uses Digital Craftsmen to host complex applications and databases that deliver more than 200,000 quotations and sell 800 policies each day.

Interviewee: Pete Johnson, CIO of 1st Central Insurance, is responsible for all aspects of IT, from the day-to-day running to long term strategy across all of the group.

What is your IT strategy over the next two years?
Pete Johnson: “Being able to change quickly to exploit opportunities in the market by doing less ourselves and taking more out to dedicated support services. We’re looking at moving our Exchange servers to our hosting partner. We’re looking at desktop virtualisation. The move to the cloud has given us the opportunity to get rid of all this ‘stuff’ and concentrate on growing the business.”

SingleLeafDrawing_editWhat are the key trends in your sector?
“The IT market is becoming more ‘commoditised’ and ‘componentised’. There’s going to be less emphasis on buying systems and more on providing capabilities. Moving from ERP to integrating business applications for example.”

How are your peers exploiting technology?
“Of the three insurance tiers, the big players have got stuff in place, the small brokers work on PCs but the middle tier — where we are — is struggling. We don’t have the skills or capabilities to run a datacentre. That’s why our hosting partner, Digital Craftsmen, is incredibly important to us. We’re an insurance company not a hosting company. We rely on them to deliver expertise.”

How have you used technology to grow your business?
“Our Premium Finance service is a profitable business with more than £5 million on the bottom line. It’s taken just four months to build. We have also brought our ‘agent portal’ extranet online very quickly. There’s no way we could have delivered these products with a big, inflexible service provider. That’s why we chose Digital Craftsmen.”

Why not use fully-fledged insurance solutions?
“Because you’re limited to the capabilities of that insurance system. Instead, we are plugging out-of-the-box insurance products into core capabilities and creating an environment where they can all communicate with each other and integrate to provide business capability.”

What were your options when selecting a hosting provider?
“We could have bought the boxes and managed them ourselves; we could have outsourced the entire job, or we could have gone for a hybrid model — a co-managed service with an external partner supporting our platform, operating system and applications. We went for the latter option and chose a hosting partner that was flexible enough to respond to our needs.”

How do you choose your providers?
“We ask: can they meet our needs 24 hours a day? Are they flexible? Can they deliver change quickly?”

Why have you renewed your contract with Digital Craftsmen?
“We were looking for a business that we could have a relationship with. We were looking for partners rather than suppliers. We wanted people that we felt comfortable with; a constant team that could provide the services that we need – now and into the future. They have been able to react to us and have done extremely well.”

Why didn’t you choose one of the larger players with hundreds of staff?
“It’s very easy to go with the big guys. But we wanted the service and flexibility that you get with a small provider. It’s a brave decision, but it will reap rewards. We love the flexibility that this gives us. We’re grateful to Digital Craftsmen for supporting us and giving us capability very quickly. We can bring new services on board in six days. They’ve more than proved their worth over the last three years; much more than many of our other IT partners.”