A New York startup counts itself among a wave of small firms trying to help life insurers with a
perennial problem: creaky, obsolete policy administration systems.
Earlier this month, Unqork raised $80 million led by CapitalG, the equity investment fund of Google parent company Alphabet. The firm, whose pitch is “no-code” software systems for enterprise insurance and financial services, has grown from 30 employees at the beginning of this year to 150 today.
Overhauling antiquated policy administration systems remains a top goal for life and annuity carriers. Last year, 26% of large and 50% of midsize insurers said in 2019 they planned to replace systems or continue with previous projects, according to Novarica. It’s the main obstacle carriers face in their drive to become more digital, said Samantha Chow, senior research analyst from Aite Group.
“Some older systems are still built on the fact that they can only do like quarterly or annual updates” to adapt the software to new demands and integrate new products, she said. Insurers running old systems have trouble finding technical help because they’re written in computer languages that aren’t popular anymore, she added.
Unqork CEO Gary Hoberman says the company’s cloud-hosted system is much more flexible. It
has a “a drag-and-drop” feature that enables customers including John Hancock, Liberty Mutual,
Goldman Sachs, Careerwise, and Prudential to build applications for analyzing data and for
The company is currently working with half of the largest U.S. life insurers, he said. Liberty Mutual, an early adopter of Unqork’s product, says in a news release it’s trained large teams of creators to build applications in Unqork’s environment. He has been frustrated by some of the conservative mutual companies who don’t seem to understand their technology.
“Their C suite leaders are really confused,” he said. He said for insurers to do the computer coding themselves is expensive to maintain and change. “It's like building a house and that window goes up and you can't move the window after you've built that wall,” he said.
Unqork’s systems can be deployed to cloud environments like Amazon Web Services, Google
Cloud Platform, and Microsoft’s Azure, to collect and combine rules and databases to support data integrations and to pull in data directly for real-time use, according to Hoberman. The company also recently won its first government contract and plans to expand into the real estate industry.
Unqork is also trying to connect public and private sector data. For instance, parents can get the birth certificate of their newborn baby registered on the Unqork system, and the baby will be automatically added as a beneficiary of their parents’ life insurance policy, will and bank account.
Before life insurers deploy their program, Unqork invites them to its New York headquarters for a
week of onsite training; it has trained 1,800 people in the insurance and financial services industries so far.
Hoberman started his career in financial services and spent nearly 20 years in the industry before moving into insurance. He was the global chief information officer at MetLife. He became
disillusioned when he discovered that so much of the insurance data he wanted to use for doing
analytics and understanding customer behavior was on paper, thwarting his team.
“There's nothing they can actually work on because there are all manual errors” in the paper
documents, he said. Aite Group’s Chow said there has been an influx of vendors trying to help insurers fix their policy administration systems. Almost one-fifth of all life and annuity carriers working with vendors have started using or are considering using cloud-based products, according to Aite Group research.
Still, few insurers use it because of security fears, she said.
This article was originally published in Life and Annuity Specialist and is reprinted with permission.