Harnessing information technology (IT) is a top priority for any business, but it comes to the forefront when companies merge. When CGU and Norwich Union joined forces last year, both had recently been through mergers – Commercial Union and General Accident had formed CGU and Norwich Union had acquired London & Edinburgh.

Although both CGU and Norwich Union had selected and developed strategic systems for the future, there was still a lot of work outstanding to move all their business onto those systems. As a result, the new company has inherited a substantial portfolio of complex systems developed by Commercial Union, General Accident, London & Edinburgh and Norwich Union.

The legacy systems from previous companies do not always meet the needs of today, let alone of tomorrow. But the task of moving data onto new systems must be managed carefully, ensuring that, while speed is essential, due attention is paid to:

  • preserving data quality
  • continuing to do business
  • investing in new technology.

    Our initial task was to reduce the number of insurance products from more than 300 to just 65, partly to improve efficiency, but also to ensure better service to brokers by avoiding duplication. Then we needed to assess which systems would help achieve this.

    The process
    There were roughly two million policies to convert onto the selected product set – an enormous task. The conversion processes have been developed in-house and supported by broker research to select and tune the systems required for product conversion. We selected the policy administration systems that supported the chosen product ranges and exploited the underwriting and claims systems that had been implemented by Norwich Union and CGU in the past few years. This enabled the process to kick off in January 2001.

    In the interest of speed and to avoid complexity, we adopted a conversion process that is a mixture of automation and manual input. We have been using EDI where possible, and extra training has been given to help staff use the multiple systems.

    In the thick of a merger it would be easy to forget about the future and invest all our resources and energy into integrating the companies. However, alongside the integration, we have maintained a programme to move Norwich Union further up the technology curve by web-enabling our new systems, linking into the insurance intermediary portal I2i-link and developing new claims solutions.

    The benefits
    The IT conversion process is neither simple nor painless. But the benefits are already becoming clear. We can deliver pricing consistency across the company, among all the relevant channels. Our common pricing platform exploits the mass of data available to us and will significantly enhance transparency in the motor insurance market. We are confident that we will also be able to roll out a similar pricing platform for household insurance.

    Another benefit is our ability to cut down on fraud, which helps manage the cost of claims and keeps the lid on premium increases. Our customers will notice that documentation is clearer and more accurate than before, and we will be able to speed up future product development.

    Completing integration will enable us to deliver the basic service and support standards – both internally and externally – that our stakeholders expect. By linking our new systems into the internet, using Polaris standards, and creating links into the insurance intermediary portal I2i-link, Norwich Union will soon be able to offer self-service capability to brokers. Self-service will:

  • offer a flexible range of solutions to meet broker needssupport the investment that brokers themselves are making in technology
  • enable brokers to manage their business in their own time, improving efficiency and servicereduce costs
  • improve broker communications
  • empower brokers to manage their clients' business by passing control to the broker.

    As more intermediaries discover the cost-efficiency and service benefits of information technology, insurance companies will increasingly be judged by their ability to deliver technology solutions that meet, and even exceed, their customers' expectations.

    However, this can only be achieved in partnership across the industry, and brokers and insurers alike must take their part in seeing projects like I2i-link through to implementation. The benefits will be shared – in the form of increased profitability and a relationship with customers based on high-quality service.