Leading insurance carriers around the world want to aalign their business and IT in ways that can transform their companies, said Dennis Maroney, Microsoft’s worldwide insurance industry manager. Companies are looking both for new core systems and for ways to reduce costs and improve agility by moving some applications from mainframes to Intel-based servers running Microsoft Windows Server.

Microsoft’s worldwide financial services group is focused on three key initiatives for insurance: the Microsoft Insurance Value Chain; providing platforms for financial advisors, such as insurance agents; and offering solutions to reduce risk and improve compliance. Global systems integrators and service providers such as Avanade, Accenture, BearingPoint, EDS, Fujitsu, HP, and Micro Focus can deliver the expertise carriers need to move to next generation systems.

The number one priority at carriers is growing top line revenue, said Maroney. The challenge for software companies is to determine what the business wants to do and then align IT to support it.

“It is a great time for us not only because people are going to buy, but the buyers are coming from the business side,” he said. “We can offer them a way to reduce costs and unleash agility by rolling out the IVC on a global basis.”

To assist companies in moving core applications off expensive mainframes, Microsoft is working with the Mainframe Migration Alliance (www.mainframemigration.org). (Mainframe migration is also the subject of a special section in this issue, beginning on page 43.)

“Moving off expensive mainframes allows enterprises to save 70 cents of each computing dollar in hardware and maintenance costs,” explained Spyros Sakellariadis, director of the mainframe migration program at Microsoft. “IT managers can use those savings to acquire new applications and improve their agility within the business.”

Microsoft-based global insurance solutions underway includes large core processing systems. For example, SunGard’s life insurance software being developed in the UK uses Microsoft’s .NET Framework and runs on Intel Itanium 2 servers.

The .NET Framework will provide carriers with a lower total cost of ownership, a significantly better user experience, and allow them to operate more effectively because it will improve their access to policy and customer information, explained Gordon Ejsmond-Frey, insurance industry manager for Microsoft in EMEA.

“.NET is playing an increasingly important role in the insurance industry, according to Matthew Josefowicz, manager of the insurance group at the research and advisory firm Celent. “Agility and accessibility are two key principles that insurers have top-of-mind when making IT decisions. Service-oriented architectures, which .NET systems can play a key role in enabling, are helping systems be more adaptable to changing business requirements and more easily integrated with the rest of a complex infrastructure.”

Maroney notes that the IVC is not only about insurance. Some large mutual fund companies have found that insurance agents are their best sales channel because they have close, long-term and trusted working relationships with their customers.

“No one has more agents/advisors than the insurance industry. They have the licenses and they are out there selling mutual fund products,” he said.

Maroney said that risk management and compliance also offer great opportunities in insurance.

Microsoft’s collaboration software provides a compliance platform that has a lot of potential for global insurance providers, said Maroney.

“With SharePoint, an auditor can see when the accountant or lawyer comes in. The information goes directly into the server, so you can see what date it went in and the date when any changes were made. It is all visible, so the underwriter knows he is looking at a complete file and not one that has been modified to make the client look better,” Maroney said.

Microsoft and its insurance industry partners can help advisors get out of the office and spend more time in front of clients, and less on administrative tasks, he added. Now the average advisor spends about 50 percent of his time with clients; through better use of technology leading insurance carriers are trying to elevate that to 90 percent. Integration and the use of Office are key to streamlining their workflow and achieving that 90 percent goal, he added.