Time for a new technology model

The way the insurance and reinsurance industry acquires its IT is fundamentally flawed and unnecessarily expensive, says Alex Mattelaer , senior partner at Technology for Europe, an insurers’ and reinsurers’ co-operative. Cost over-runs, late delivery and disappointing performance are almost routine. Despite all those promises of scalability, the technology is out-of-date almost as soon as it arrives. Mr Mattelaer points out that the insurance sector has a far longer investment cycle than the next-quarter horizon of software suppliers, whose imperative is to maximise profits from today’s technology; that most software suppliers make the bulk of their money from licence fees and have limited interest in providing the service their customers want; that whatever the industry may be told about tailoring systems, buying an IT application means adopting someone else’s business process model or changing it at great expense; and that designers of software have a vested interest in making it as impenetrable as possible to others. Mr Mattelaer believes that if the industry is to cure these deep-seated problems it needs a new technology model.