GD White Paper Pub Insurance 360 Technology Trends

Grid Dynamics Whitepaper
Insurance 360:
Unlock value creation with these
industry-disrupting, experience-refining
trends
www.griddynamics.com
March 2022
Grid Dynamics | Insurance 360
Contents
Introduction 3
The keys to unlock value creation in 4

the insurance industry in 2022 and
beyond
Trend #1: Connecting people and data 5

with 360-degree customer views
Trend #2: Application modernization 10

and cloud migration
Trend #3: Unlocking the value of 15

customer data with AI and ML
Conclusion 17
About Grid Dynamics 18
Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 2

Introduction
With these challenges in mind, Insurers now face
essential strategic questions about how to unlock
potential consumer demand, improve customer
experience and regain momentum on the ever-enduring
There is no question that the impact of quest to improve productivity across critical business
the global pandemic, coupled with rapid processes.
technology adoption and innovation, is

fundamentally restructuring the ways in Some of these questions include
which the insurance industry operates.
How can insurance commercial teams better
Three challenges are driving this change: understand customer needs and grow the company’s
insurance portfolio?
How can underwriters and claims teams get
1. Global insurance industry profits
comprehensive access to policyholder data to
have dropped a significant 15%
evaluate risk, optimize pricing and process claims
since the start of the pandemic,
faster and more efficiently
with premium growth slowing to
approximately 1.2% (compared How can teams in the entire insurance business
with more than 4% per year ecosystem communicate seamlessly across channels
between 2010 and 2020). Record with access to unified data-driven insights?
low investment interest rates over
How can the customer experience be more
many years have driven down
streamlined, personalized and downright delightful
overall reserve returns.
in order to meet and exceed customer demands as a
competitive differentiator?
The answer to these questions lies in the adoption of

2. The threat of industry-disrupting
modern, centralized, scalable technology in the cloud.
Insurtechs is looming. With
The results? Your people and your data will be
mammoth investments and laser
connected, your underwriting and claims handling
focus on the marketing and
processes will improve, your policyholders will stick with
distribution segments of the
you for the personalized service they receive, and
insurance value chain, Insurtechs
ultimately, your revenues will reach new heights.
are able to solve customer pain

points through a digitally Read on to discover the three technology trends that
enhanced client experience that insurance industry leaders are focusing on to maintain
incumbent carriers are struggling and continuously grow their competitive edge.
to compete with.
3. Discordance of customer data

across the entire insurance
business ecosystem is impeding
large property & casualty (P&C)
insurance enterprises from
gaining a competitive edge in the
current market.
3
The keys to unlock
value creation in the
insurance industry in
2022 and beyond
In this whitepaper we discuss three crucial technology
trends that insurers should be implementing, making
sure to align them with evolving long-term technology
strategies:
Insurance 360-degree customer views for
enterprise-wide accessibility to relevant customer
data, seamless internal communications, more
informed underwriting and claims handling, and
insurance portfolio growth;
Modernized applications in the cloud for efficient
data aggregation, processing and effectively
implementing 360-degree customer views in the
enterprise;
Artificial Intelligence (AI) and Machine Learning
(ML) to unlock the latent value of customer data
for personalized customer relationship
management across the enterprise. McKinsey
estimates that $1.1 Trillion dollars of annual
improvement is addressable by advanced
solutions.
Let’s dive in and explore how these technologies work
and the benefits they provide to insurers.

Trend #1: We are not only in the midst of a thriving digital

economy, but increasingly in what is referred to as
Connecting
the experience economy. Customer experience has
now become the pillar of every business strategy in
every industry, and customers have come to expect
people and data superior experiences from service providers across
channels.
with 360-degree It’s time for the insurance industry to face the facts:
customer views People no longer buy products, they buy

experiences.
In fact, according to research by PWC, customers are

willing to pay more for the experience qualities that
matter most to them:
43% of consumers would pay more

for greater convenience
42% would pay more for a friendly,

welcoming experience
of U.S. customers find a positive
65% experience with a brand to be

more influential than great
advertising
How are businesses providing this type of customer

experience? By building a customer 360-degree view
that includes the capability to analyze direct
interactions between company and customer, collect
data about customers’ browsing and buying
behavior, as well as credit and risk scores, and
aggregate data into comprehensive, individual
customer profiles.

Customer policy
Customer residential/
details business address
information
Customer claims Customer dependents

information information
Customer socio-economic
Customer contact & demographic
preferences information
Customer Customer interaction

experience insights records
Customer behavior
Customer IoT
insights & NBA
sensor data
recommendations
Insurance 360-degree customer view
The benefits of 360-degree customer views is twofold:
1. Customer experience will be 2. Agents and teams across the insurance enterprise
greatly enhanced through will have centralized access to relevant customer
personalized marketing, sales data to improve cross-departmental communication
and service engagements. for improved decision making and risk analysis,
process efficiency, and customer service.
Let’s look at both of these areas in more detail.

Maya, Lemonade’s AI chatbot, continuously collects

and learns from customer data to provide
Enhance and personalized service without the user ever having to

talk to a live agent
personalize Through omnichannel marketing and engagement,

Lemonade is easily accessible and ever-present for
customer existing and potential customers, while at the same
time enabling the company to analyze buyer
experience with journeys in detail
Lemonade uses end-to-end automation driven by

360-degree customer data insights to streamline and accelerate
the processes of choosing and purchasing insurance
customer views policies, right through to claims processing - no
complicated manual forms or waiting on hold with
an agent.
As a result of Lemonade’s massive and rapid success,

Consumer behavior and the demand for many traditional insurers are feeling the heat to
personalized customer experience requires modernize their approach to customer engagement.
a shift in insurance marketing and Survey respondents in the 2022 Deloitte Insurance
distribution models. As more consumers Industry Outlook report largely agree that their
embrace digital channels to shop, view, company's highest investment in marketing, sales and
compare and communicate with service distribution over the next year will go toward data and
providers, more opportunities for insurance analytics in order to create more personalized customer
companies to collect customer data become experiences.
available. Analyzing this data not only

empowers your insurance company to As you can already see, it is not only customers who
develop more customized relationships with benefit from an automated, data-driven approach in
current policyholders but also helps you insurance. Let’s take it a step further and expand on the
develop predictive analytics that inform benefits for insurance agents, brokers, commercial
insurance product development and data- teams and third-party vendors in particular.
driven marketing campaigns for more cross-
and up-sell opportunities.
For example, Lemonade, a refreshingly

customer-centric insurance company that
has disrupted the industry in a very unique
way, capitalizes on 360-degree customer
views in the following ways
Lemonade claims that it collects 100x

more data points per customer
compared to other companies.
“Everything we do is based on data,” says
Gil Sadis, Head of Product at Lemonade.
Customer data is centrally available to
executives, product, marketing,
analytics, customer service, and even
underwriting teams, in order to drive
better customer experiences.

Harmonizing data and merging legacy policyholder

records across departments and subsidiary firms helps
Improve connect the right data to the right people at the right
time.
insurance Your claims department, underwriters, brokers, agents

and third-party vendors will have all the policyholder
productivity and data they need at their fingertips, including real-time
incident reports, risk analyses, policyholder history and
efficiency with up-to-date policy details for faster, more efficient
service delivery with a personalized touch.
360-degree
customer views Identifying new opportunities with
more customer data
The second part of this challenge is that many insurers

do not have enough customer data to make a
Good insurance is built on data. Great
meaningful impact on service delivery. Typically, an
insurance - from service levels, underwriting
insurer only collects data when a customer requests a
discipline, and product offerings, to digital
quote, pays their premium, and files a claim. This is not
customer experiences and speedy claims
enough information to fully support customer
processing - is built on the mastery of data.
experience personalization or to identify new
This should go without saying, yet one of
opportunities.
the biggest challenges that large property &

casualty (P&C) insurers still face is By collecting and combining data from your call center,
disconnected and unused customer data mobile application, chatbot, website, and social media
across their ecosystems, resulting in siloed channels, and running the data though analytics and
operations and service inefficiencies.
machine learning processes, insurers can have a 360-
degree view of every customer and provide better end-
There are three parts to this challenge:
to-end customer service with insight into their needs,
disconnected legacy data, lack of customer
preferences and potential problems. Your commercial
data, and the inability to prevent fraud.
teams will have the knowledge on how to engage

meaningfully with customers with insights into their
behavior, likes and dislikes, and preferred methods of
Unlocking the value of legacy communication.
data
The first part of this challenge is accessing

and unlocking the value of huge troves of Detecting and preventing fraud
data in legacy tech stacks and disconnected through centralized customer data
systems. By creating a single connected

The third part of this challenge is an inability to detect
digital insurance ecosystem with technology
or prevent fraud. When information is siloed, it is easy
to mine that data with new machine
for insurers to miss policy duplication and potential
learning services, insurers can turn raw data
fraud cases. For example, a policyholder may file
into actionable, valuable insights that
multiple insurance claims for loss or theft for a single
enable them to deliver a more personalized,
insured property, which can be difficult to detect when
seamless insurance experience and
that customer’s data is not unified.
eliminate workplace inefficiencies and

bottlenecks. Having a 360-degree customer view makes it easy to flag
potential fraud cases and prevent them from occurring.

Picture this:
A policyholder files a claim. Without harmonized

customer data, the claims department struggles to
identify and understand the customer’s policy record,
history, behavior and risk, which in turn leads to
inefficient and slow claims handling, and a
disgruntled customer.
Further, if the underwriting databases and risk models

populated from third-party data sources and internal
company data are not linked to the policy
management systems, underwriting loses visibility. It
becomes difficult to determine who the policyholder
is, which policy they have purchased and whether the
risk has been properly priced.
With a 360-degree customer view, these problems are

automatically solved because all of the relevant
information is aggregated and accessible from a single
source of truth. What’s more, if the policyholder has a
policy with a good risk profile, an up-sell or cross-sell
opportunity arises.
Let’s say the policyholder has an auto insurance

policy, and the insurer knows that the policyholder is
also a homeowner because the relevant demographic
information is immediately available. The insurer can
then suggest a discounted home insurance policy to
complement the policyholder’s existing plan. The
insurance company has effectively provided a
seamless experience and grown the insurance
portfolio in one clean swipe.
Now that the benefits of 360-degree customer views in insurance ecosystems are clear, how do insurers
implement such a system and how does it work?
Enter modernized technology applications in the cloud, artificial intelligence and machine learning.

Trend #2: From 2012 to 2020, technology’s average share of

operating costs rose by 36% for P&C insurers. Driving
Application this expense is the growing cost of maintaining and

updating legacy systems, some of which are decades
modernization
old. Furthermore, private investors are keenly eyeing
the prospect of attractive returns by investing
heavily in emerging insurtechs, who are proving that
and cloud innovative technology is changing the game for
insurance marketing and distribution success.
migration To support the requirements of the digital age,

incumbent insurance carriers are compelled to
replace monolithic systems and migrate to the cloud
as a survival imperative. The challenge though is that
such a large and wholesale change can take 5 to 10
years before a return on investment is realized, and
the impact on business continuity can be significant.
In light of this, insurers need to determine what their

most important business requirements are, identify
the technology required to achieve them, and begin
an iterative change management process by
migrating applications to a microservices
architecture, containers, continuous delivery, and a
cloud-native technology stack.
Next we will outline the steps required to modernize

applications in the cloud, as well as the
overwhelming benefits of doing so.

G rid Dynamics | Insurance 36 0
Digital
Quote Bill Quote View claim Exchange rates Adress validation Service requests
Services
Geocoding Bind Issue Rating Submission Account mgmt. Documents FNOL
Risk & security ECM Core
EXTERNAL INTEGRATIONS
Enterprise management
services
Application security Application management

Legacy Claims Policy Billing
Identity access
Service management
management
Data protection MDM Data Build/Deploy Management
Application test & quality

Infrastructure services
Project & portfolio mgmt.
Hardware Storage Network Hosting Databases Platforms

K nowledge management
High level microservices architectural view for a typical insurance ecosystem

Strangle the monolith with Migrate to the cloud
microservices
Most insurance companies have already recognized the
Over the years, most insurance enterprise value of the cloud, but may be slow to adopt. The
applications have grown into large benefits it brings are diverse and include elastic
monoliths, which are difficult to maintain, scalability, increased reliability, faster speed to market,
slow to change, and expensive to maintain. and more flexible cost models.
One of the top reasons for application

modernization is to increase speed to
market, foster DevOps culture, and enable Reduce infrastructure cost with
seamless 360-degree customer view container-based deployment
capabilities at scale. By breaking the

monolith or gradually strangling it, While many benefits of cloud infrastructure can be
insurance enterprises can achieve these recognized without using containers, adopting
goals and migrate to microservices container-based deployment amplifies the value of the
architecture without disrupting operations cloud. Modernizing application packaging and
in the greater insurance ecosystem.
embracing kubernetes-based platforms with service

mesh reduces infrastructure costs by 30%, increases the
speed of the continuous delivery process, and improves
What are microservices?
developers’ productivity.
Microservices architecture is used to build

flexible, independently deployable software
systems that communicate with each other
Increase speed to market with DevOps
through APIs. The decentralized architecture and CICD practices
provides a layer of abstraction to It’s difficult to achieve continuous delivery and high
decompose large core insurance capabilities speed to market with legacy applications and
into fine-grained single purpose, self- monolithic architecture. Most of the modern DevOps
contained and independently deployable best practices and CICD tooling is built for microservices
business services. This makes the environments. By modernizing applications, migrating to
architecture much more agile and opens the microservices architecture and a modern technology
possibility of quick and faster deployments stack, insurance companies can expect a 10x increase in
instead of waiting for the traditional slow speed to market.
periodic releases. This architecture also
opens the possibility of tailor-made
customer journeys which can be enhanced
quickly based on market needs.

Increase operational efficiency To help companies reduce the cost, effort, time, and risk
of building analytical data platforms, Grid Dynamics,
with end-to-end automation
together with AWS, created an Analytics Platform that
When approaching application satisfies the data analytics needs of Insurance
modernization, one of the goals is to companies, including:
automate all aspects of the end-to-end
application delivery cycle, improve Feature completeness – the platform has all the
supportability by implementing necessary capabilities to satisfy the 360-degree
autonomous application principles, and customer view and data analytics needs of
implement continuous efficiency to keep insurance enterprises, and uses cloud architecture
speed to market and quality high, while and security best practices.
keeping infrastructure costs low.
Application modernization is clearly critical

Accelerated speed to market – the entire platform
for overall insurance process efficiency, but
can be provisioned in one day and integrated with
what is the best platform to support 360-
the insurance company's ecosystem with
degree customer views in particular?
onboarding of the first data sources in a matter of

weeks.
Establish data and ML

platforms for 360-degree No additional license costs - the platform is based
on AWS cloud services and open source
customer views
components, so the insurance company only needs
How can Insurance companies get started to pay the cloud costs which are significantly lower
with 360-degree customer views? The than supporting legacy systems.
answer lies in the implementation of an
Analytics Platform built on microservices
architecture in the cloud to automate data Supports DataOps and MLOps – the Analytics
aggregation and quality processes, Platform contains key technology enablers for
streamline data flows through the DataOps and MLOps best practices, many of which
enterprise, and derive actionable insights we describe in our “5 Technology Enablers for
from data with AI and ML algorithms. DataOps” article.
Low risk and high reliability – all components have

been battle-tested and pre-integrated to ensure
seamless end-to-end functionality.

Data lake & pipeline Reporting / BI

structured data
Customer data
(MDM) EDW
Clickstream Access layer

structured
data
Transactions Data storage
streaming
Products structured data
Offers &
API layer ML platform
promotions
batch Access layer Data science process

Interactions raw data
3rd party customer Orchestration Experimentation

data (DMP)
models
Data quality Model implementation
Environment
Data governance Model training and scoring
When coupled with the right data governance, DataOps, and MLOps best practices, processes,
and organizational structure, the Grid Dynamics Analytics Platform provides a robust set of
capabilities to satisfy the data, analytics, and AI/ML needs of any enterprise.
And with that we find ourselves on the edge of the next leading trend for Insurance companies:
unlocking the value of data with AI and ML.

Trend #3: Most insurance executives from leading companies

would agree that scaling the impact from data and
Unlocking the
analytics have become table stakes. These leaders
see enormous potential in best-in-class data and
analytics capabilities across the value chain, with
value of leading P&C insurers seeing loss ratios improve
three to five points, new business premiums increase
customer data 10% to 15%, and retention in profitable segments
jump 5% to 10%.
with AI and ML The benefits of data and analytics systems are clear,
but how can insurers gain access to relevant data to
generate the most value for 360-degree customer
view capabilities?
Customer intelligence and Next Best Action

prediction models streamline a number of critical
decision-making and engagement processes using
advanced AI/ML algorithms to analyze, predict and
inform.
Specific use cases include:

Automated risk scoring for more informed
insurance underwriting
Next Best Action recommendations for
streamlined claims handling
Next Best Action recommendations for
personalized marketing, sales and ongoing
customer service engagements.
Expanding on this, one of the main benefits of

customer intelligence is the ability to quantitatively
analyze customer journeys across insurance
channels, understand what drives certain customer
behavior, efficiently analyze risk, detect fraud, and
determine through next best action predictions how
the level of engagement and process efficiency can
be improved.
Leading AI/ML software is able to automatically

optimize billions of micro-decisions related to risk
analysis, fraud detection, churn prevention,
customer experience personalization, message
targeting, and timing.

Agents Clients Digital channels Internal teams
Outbound integrations Analytics and insight
Real-time events Risk scores
Marketing systems and vendors Propensity scores and audience
Data storage and processing
Risk scores Feature store Data quality checks
Identity resolution Data privacy Data discovery
Inbound integrations
Mobile SDK Streaming Cloud sources
Data collection and analysis can be challenging for insurance companies that receive data
from a large network of internal sources, clients, and third-party sources. With the
integration of scalable components to process multiple data feeds and real-time streams,
followed by data quality, privacy, enrichment and scoring processes, consolidated data and
insights can quickly and seamlessly flow through the entire insurance ecosystem for
efficient 360-degree customer views.
By leveraging the latest achievements in reinforcement learning with real-time customer data, insurers
are empowered to optimize omnichannel engagement, retrieve key insights about customers, and
manage various aspects of customer experience personalization from a single source of truth.

Conclusion Are you ready to

accelerate your
Building a powerful 360-degree customer
view using modernized technology insurance 360
platforms in the cloud and AI/ML processes
for valuable data-driven insights enables journey?
forward-thinking, customer-centric
insurance enterprises to differentiate
2022 is a year for bold new ventures and
themselves from competitors, continuously
creative new ideas. Making the most of your
delight their customers, capitalize on
insurance technology investments this year
opportunities for cross-selling and means choosing a technology partner that
upselling, and unify the insurance will work with you to
ecosystem for improved workplace
Develop innovative, differentiating
efficiency and increased revenues.
experiences and applications that
delight customers with modern user
experience approach, AI powered
features, responsive web UI, and native
mobile apps
Build distributed, scalable, cloud-native
360-degree customer view solutions
Leverage data as one of the most critical
assets, build powerful analytical
platforms, and drive insights from data
with machine learning and artificial
intelligence
Embrace Agile methodology, a high-
performance engineering culture,
DevOps and automation to change and
innovate faster and cheaper.
Choose Grid Dynamics in 2022 as your agile

co-innovation partner.

About Grid Dynamics

Grid Dynamics (Nasdaq: GDYN) is a extensive expertise in emerging technology,  
digital-native technology services provider that top global engineering talent, lean  
accelerates growth and bolsters competitive software development practices, and a
advantage for Fortune 1000 companies. It high-performance product culture.
provides digital transformation consulting and

implementation services in omnichannel Headquartered in Silicon Valley, with delivery
customer experience, big data analytics, search, centers located throughout the United States,
artificial intelligence, cloud migration, and Western, Central, and Eastern Europe, Grid
application modernization. Grid Dynamics Dynamics is known for architecting and
achieves high speed-to-market, quality, and delivering some of the largest digital
efficiency by using technology accelerators, an transformation programs in the retail,
agile delivery culture, and its pool of global technology, and financial sectors to help clients
engineering talent.
win market share, shorten time to market, and
reduce the costs of digital operations on a
Grid Dynamics works in close collaboration with massive scale.
its clients on digital transformation initiatives

that span strategy consulting, early prototypes, In 2019, Forrester named Grid Dynamics a
and the enterprise-scale delivery of new digital leader among midsize agile development
platforms. It helps organizations become more service providers. In 2020, Grid Dynamics went
agile and create innovative digital products and public and is trading on the NASDAQ under the
experiences using its
GDYN ticker.
The Forrester wave™
Midsize Agile Development Service

Providers Q2 2019
Stronger strategy

Key facts about us

12 countries across North America and Europ
About Grid 3,500 employees in Q2 202
Dynamics Forrester Leader Midsize Agile Software 

Development Service Provider Q2 2019
Our areas of expertise
Data Science and Artificial Intelligenc

Analytical data and ML platform
Enterprise and site searc
Omnichannel experienc
Cloud enablemen
DevOps and QA automation
Our clients

trusted engineering partner for digital transformation
Grid Dynamics Holdings, Inc.
5000 Executive Parkway,
Suite 520 / San Ramon, CA
650-523-5000
www.griddynamics.com

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Grid Dynamics Whitepaper

The keys to unlock value creation in 4

Trend #1: Connecting people and data 5

Trend #2: Application modernization 10

Trend #3: Unlocking the value of 15

About Grid Dynamics 18

Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 2

technology adoption and innovation, is

The answer to these questions lies in the adoption of

are able to solve customer pain

3. Discordance of customer data

The keys to unlock

value creation in the

2022 and beyond

In this whitepaper we discuss three crucial technology

trends that insurers should be implementing, making

sure to align them with evolving long-term technology

Insurance 360-degree customer views for

enterprise-wide accessibility to relevant customer

data, seamless internal communications, more

informed underwriting and claims handling, and

insurance portfolio growth;

Modernized applications in the cloud for efficient

data aggregation, processing and effectively

implementing 360-degree customer views in the

Artificial Intelligence (AI) and Machine Learning

(ML) to unlock the latent value of customer data

for personalized customer relationship

management across the enterprise. McKinsey

estimates that $1.1 Trillion dollars of annual

improvement is addressable by advanced

Let’s dive in and explore how these technologies work

and the benefits they provide to insurers.

Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 4

Trend #1: We are not only in the midst of a thriving digital

customer views People no longer buy products, they buy

In fact, according to research by PWC, customers are

43% of consumers would pay more

42% would pay more for a friendly,

of U.S. customers find a positive

65% experience with a brand to be

How are businesses providing this type of customer

Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 5

Customer claims Customer dependents

Customer Customer interaction

Insurance 360-degree customer view

The benefits of 360-degree customer views is twofold:

Let’s look at both of these areas in more detail.

Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 6

Maya, Lemonade’s AI chatbot, continuously collects

Enhance and personalized service without the user ever having to

personalize Through omnichannel marketing and engagement,

Lemonade uses end-to-end automation driven by

As a result of Lemonade’s massive and rapid success,

available. Analyzing this data not only

For example, Lemonade, a refreshingly

Lemonade claims that it collects 100x

Copyright © 2022 Grid Dynamics International, Inc. All rights reserved. 7

Harmonizing data and merging legacy policyholder

insurance Your claims department, underwriters, brokers, agents

The second part of this challenge is that many insurers

the biggest challenges that large property &

teams will have the knowledge on how to engage

The first part of this challenge is accessing

Dynamics Forrester Leader Midsize Agile Software 