April 23, 2012
-- The introduction of new regulations in the insurance industry look set to have a considerable impact on the sector and its consumers over the next 18 months. It’s widely believed that the new capital resource requirements of Solvency II, and the cost of testing and implementing the new regulations, will result in higher premium prices for customers and may also lead to poorer quality products and a downturn in sales.
In light of this, there is increased pressure on insurers to streamline pricing operations and maximise profit opportunities in order to gain a competitive advantage. Key to this is the leveraging of new technologies that can simplify processes and help build differentiation. While the benefits of new technologies often outweigh the costs, for many small to mid-sized insurance companies the traditional implementation outlay can prove prohibitive. This is where cloud-based technologies offer real opportunity.
A new entry in the insurance software market, RightCalc (www.rightcalc.com)
has been specifically designed to provide an alternative to more expensive pricing solutions. The cloud-based application uses a “pay-for-what-
you-use” subscription model that requires no capital investment and offers the flexibility to plan and build calculations without incurring costs. Subscription charges are only incurred for active financial products, meaning that customers only pay when a price calculation is helping generate revenue.
To encourage early sign-ups, the company is offering new subscribers unlimited free use of RightCalc for six months, with the subsequent six months at half price. The offer extends until the end of May 2012.
Damien Byrne, Technical Director at RightCalc says: "We are very excited about our new SaaS (Software as a Service) offering because it provides a comprehensive suite of price configuration, scheduling and distribution services at a fraction of the cost of many other pricing solutions. RightCalc is unique because it’s an economical solution that addresses a particular need of small to mid-sized insurers that has been overlooked.”
Pricing processes vary widely in the insurance industry, with many insurers still using paper or excel-based systems as the principal method of configuring and distributing prices. While advanced price management systems enable huge volumes of product data to be analysed and processed, what’s often overlooked is the need to avoid bottlenecks in the configuration, scheduling and distribution processes. After all it’s of little use creating prices that react to changes in the market place if you’re going to be publishing them long after that particular boat has sailed.
For insurance companies, cloud environments can help decision makers from actuarial, finance and underwriting teams work together to customise product offerings and create price revisions that hit the ground running. It’s a collaborative pricing approach that’s helping companies using the cloud gain a competitive edge.