Ep 25: Wendy Aarons-Corman, CEO of OWIT on Extending & Enhancing Legacy IT Using Microservices

It is well known that the insurance industry has a lot of IT legacy debt. Replacing those systems could cost individual companies tens of millions of dollars. In this episode, I spoke with Wendy Aarons-Corman, CEO of OWIT about using microservices to extend AND enhance current legacy IT systems.

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Connect:
Wendy Aarons-Corman (LinkedIn) – https://www.linkedin.com/in/wendy-aarons-corman-mba-msop-0a36569/
OWIT (Homepage) – https://www.owitglobal.com/

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Transcript

Nick
Aaaaand we're live back...The Coverager Podcast. Late...like I keep I keep doing this I keep forgetting what date we are but it's a June 18th late in the afternoon, and we're going to have a conversation about systems, insurance systems, legacy systems and the evolution of where it's going. My guest is Wendy Aarons-Corman...Wendy...wWelcome from his historic Connecticut?

Wendy C
Historic Connecticut a town called Collinsville,

Nick
and it finally turned hot?

Wendy C
It's hot today

Nick
and you went from typical New England. You went from there directly into summer?

Wendy C
Yeah, we went into summer today and supposed to be a heatwave this weekend. You know, considering a couple weeks ago, I think we had some snow, so...yeah, I guess in between so

Nick
Typical New England. We're gonna have today a conversation on basically legacy issues and systems within insurance because you are, I think founder or co founder of a company called OWIT, it so I want to start right off the bat and give you a platform and talk about Wendy Aarons-Corman, who you are, and what is Oh,

Wendy C
we're okay, so um, you said my name Wendy Aarons-Corman. So I have been in the insurance and technology segment my pretty much my entire career. I started as a software developer, math computer science major who came out of college vowing she would never work in the insurance industry because it was all technology and who wants to work on COBOL systems. But I did find a really wonderful startup company here in Connecticut in Simsbury, Connecticut that was looking for developers to develop in, it was C sharp, SQL, Windows encrypted technologies, relational databases, it was all brand new. And that's where I got my start in the insurance industry. So we were doing state of the art insurance processing systems, we were building our own. And I loved it. I loved interacting with the business. I loved learning about the business and then developing systems for that. And we were in a very dynamic specialty insurance lines. And so everything was changing all the time in terms of getting new products to market. So it was very dynamic, actually, the entire company was young, and it was just we were all you know, really living it and loving it. So anyway, that's where I got my base and we were eventually acquired by Chubb and I worked with a insurance exchange effort by the chairman of executive income, it was called executive risk. So he wanted to do an insurance exchange. So I became his chief technology officer and had a great time learning about new technologies for the internet because the internet was just coming around and there was an opportunity there. But the problem with the business model at the time was that the large insurance carriers were not ready to give up their agents. So it was a very difficult sell at least to the larger carriers. But in the process, the CIO at CNA insurance introduced me to the bunch of guys who were just developing a new product for the internet. It was all XML based, tool based. They were just getting started and their name was weird. While they were the company was called Duck Creek technologies, right? Small company, I think just a handful of people out of Bolivar, Missouri. Got to know the guys I loved what they were doing, it was amazing. Product configuration tool based XML that's exactly what we needed for this insurance exchange. And while this effort at Chubb did not work out I was asked to join the team to help them grow the business. So basically, I was a software developer, but I was the extrovert of the team. And so I became business development. And so some guy, the CEO of Duck Creek, took me by the hand said, you're gonna be great at this. And I loved it. I love the business development, because really what it is, is talking to people to find out what their their problems are, what they're trying to solve, and then seeing if the technology will fit the problem. And that's how we approached the industry.

Nick
Isn't it funny how sales just boils down to that?

Wendy C
It's all it is. It's just having a conversation and the hard thing, the thing about sales is that you have to realize that if it's not a match, you got to walk away. And there's two reasons for that one, because you're not going to be successful no matter how you try to retrofit that square peg in that round hole. But secondly, somebody's going to get hurt for it, and it's most likely the person who made the decision. You know, could be a CIO loses a job and it's just not worth it. I mean, human to human. Let's do what the right thing is. Yeah, it was good. So I, we have a great group of people, we grew that company. Eventually that company sold his consulting work for some software companies. And I did some strategic consulting for technology teams, in terms of, you know, growth. But along came this opportunity here, and I'll just throw myself into this OWIT Global. So OWIT Global we we got together a bunch of folks, just a few of us about two years ago. And we're trying to figure out what we could do that was not a me too type of an organization. And I mean, at this point, got Guidewire and Duck Creek, and as you know, they're all massive companies making massive amounts of money and we're not looking to compete with any of that. You mean, we just would not, we would not win. So what we did realize, though, is that all these investments and legacy systems were out there and that people were trying to rip and replace which is a traditional way of you know, updating your technology. And we wanted to give people an option, you know, what if we extend your legacy? What if we could fit in these technology components that would extend them to, you know, digital, you know, or extended to the web if they if they're not web enabled, you know, or extended to, to add another coverage without having to re to get that coverage into that legacy system.

Nick
And when you say extend, it sounds like the way you're describing it. It's like extend & enhance, like not keep it at at the level it was performing, but not do anything crazy, keep it alive, but also give you additional capabilities type of thing.

Wendy C
Yeah, that is that's exactly what it is. So in other words, those core systems are good systems. Generally they're doing they're processing large amounts of premium and they're probably doing a great job. The problem starts when you start to make changes to those systems. The testing cycles are long, right? Or it takes a long time to get a new product into the system. So what if you could extend those to enhance those? Exactly? I think that's very well said. So, um, so we were very keen on doing something with micro services. And we also thought that with the micro services that we could build, that if we combined our own micro services together, we could we could sell solutions for people who needed solutions, right? So anyone can build micro services, there's no doubt there are tools out there to do that. But what we provide is insurance specific micro services. So they'll have workflows or some sort of a content in them that are basically made to fit an insurance. Yeah.

Nick
Right. And that's a that's a very important point. I don't want to get too far away without clarifying for those in the audience that might not be aware. First of all, your approach is to go after bits and pieces of it to extend and enhance but rip and replace Or just a complete overhaul? is, it could be in the 10s of millions of dollars. Right?

Wendy C
So, so expensive, crazy money, such crazy money. And, you know, we're trying to solve that problem. I mean, I would think that over time with success of people engaging with microservices products, that the price points will come down that there'll be options for them not to have to, spend all that money. It is very, very expensive. And actually, it's a very good point because when we go out and talk about microservices, we look at the numbers of how much it costs to rip and replace versus if you have done something with microservices. Right. So, so we we started developing products. You know, our innovation officer, his name is Ethan Whittaker, he's up in Maine. He was actually a Duck Creek guy. Duck Creek, bought his billing system and built their billing on his system. So Ethan's built and sold other products. He's, he's amazingly talented and he's trying to You know, he's thinking all the time of how we can do this better, more efficiently, right? So we have a no code environment. I know a lot of people talk about low code, no code, but we are truly are a no code. So it's all drag and drop workflows, calculations, screens for user experience, things like that. It's all no code. So we have a canvas. And that's how that works. We are committed to that environment, because we do want the business analyst or the marketing person to be able to manage, you know, the changes that come through. We have we started with rating, we start with rules, rating rules is embedded in everything we do. So it's a separate micro service. You could buy it separately, but it's in it communicates with all of our micro services because there's rules and everything you do. User Experience services, on documents, services, you know, there's a lot of document generation solutions out there, but all we do is take data, generate a document and save it or email it or do Something with it. Whereas all the other systems that have been out there that have come out over the years, there's lots of bells and whistles, but people were paying and not using those bells and whistles. So we've actually had some conversations going on with a carrier out in the West, that all they want to do is generate document perfect. That's all we do. It generally don't two hours for proof of concept for a document just to give you some sense of the speed. And then we have on we have yo if you push our solutions together, as I talked about, they all talk through API API's. So we when we solution sell, we talk about portals business to business business to consumer internal portals, we can take disparate back end systems and create a single view of all of those. So to the user, it looks like one system. Right? That's a single user experience. We were doing a broker portal for a carrier. We're in conversations obviously with other carriers as well. Point of Sale you know everything. I mean, you Take the pieces you need. If you have a rating engine, you don't have to use ours, use our front end, use our doctrine, use our rules, you know our integration service, and you use your rating service. But if you need rating, we can give you rating. It's all bits and pieces and parts, you know, you pick the pieces. And then we have this wonderful product called Boudreaux management. And so, prior to coming to a global, I was doing some consulting work for a very large binding authority company who was acquiring more and more companies over time. And I found out that the managing of border row feeds coming in mg us or Jason to the carriers was all being done manually. And these are large companies with lots of contracts and tons of data coming in it was taking multiple people all month to get border or reports, you know, right as they came in, and then getting them ready to go out. Like to the you know, crazies So, we, we have an amazing boardroom management solutions all made out of micro services and for the mgu it takes data out of databases creates those contract order reports to send out, cleanses them, you know, consumes data cleanses them, you know, maps them and creates the file for the carrier it consumes the data. It will cleanse it, you know, again, you know, go through a logging process to make sure it's right you know, you can go through the correction process, map it and then save it to a database right and then all the database all the data can go out to the, to the other, you know, people in the distribution chain.

But so we're very excited about that because it is a lightweight, it's no code drag and drop, you know, it's it's very easy to configure. We can get your first product up, you know, pretty much running for policy, cash and claims, you know, within within six weeks, and the rest of it you can keep doing on your own once you get once you get trained. Of course, there's integration work that needs to get done. But generally the carrier would do that, you know, into their systems. But we're very proud of that product. And we're demonstrating that two to three times a week now, it's just it's really fantastic. The one point I would make about the microservices, you know, big value proposition is that they are reusable. So when you buy a system, you buy a complete system, it does this, right. When you buy a solution that's built on microservices, you might have three, four or five micro services that are under there making that happen. You can take one of those out if you have another project in the future, and reuse that for a project. So if you're doing a point of sale, and then you decide you want to do a broker portal, you can use a user experience service that's part of that point of sale solution and use that for the other product. That's a huge value proposition to the to the buyer.

Nick
I wanted to keep harping on the miceoservices thing because you touched on it initially with the lower cost, lower investment, but it's also lower risk too right for. Because these are these are small, small bits of code that do a particular job. If If one thing that one thing I like about microservices is you can string them together, right. So all of a sudden you have this like, new, unique workflow that's occurred. But I think one of the interesting parts about microservices is that it solves part of the problem that got us to where we are today. We have these like big lumbering systems where it's really if some, when when a new technology like the internet comes on board, really difficult to shoehorn that in without just reconfiguring a system, but with a micro service. If a If a If you're a little bit of code becomes outdated. There's a new way to do it, you can kind of pick that up and drop a new one in, that incorporates that new technology. So you've, you've, you've dramatic and not only have you dramatically lowered the cost, you've dramatically lowered the risk of your systems going forward, which is why I'm such a big fan of these microservices. Yeah.

Wendy C
And it's a very good point, you know, they are replaceable, there's no doubt. I mean, instead of replacing the whole system, you can replace a part of it, which is really nice. It's almost like going in getting your alternator. Yeah, like, right on. So that is a that's definitely a huge value proposition. I also think that microservices are going to get more intelligent in time. So you know, you know, you talk about what you're doing, you don't know what you don't know is going to happen. So what we always talk about is the fact that the ecosystems are going to change. You know, I truly believe that portals Will not you know, we'll be you know, de facto, right because if you look at the people that are using their phones, To get information, especially, you know, the next, you know, group of buyers that are coming, you know, coming up, you know, they're going to go to, they're going to go to some, you know, place that they're familiar with to shop, you know something or they're going to find out from a friend, where should I go to look for insurance, right? It's not necessarily going to be go to this portal, right? It's going to it's going to be some sort of comparative or hitting, you know, some kind of thing. So being able to feed all of those, you know, ecosystems with the data for quotes or binding or whatever that might be. And sort of go headless, I think is where it's going to end up. I mean, we're seeing a little bit of traction happening on the headless, the headless agent of the headless carrier for the agent. That demand is beginning to pick up a little bit. We have an integration service that supports that because what happens is the integration service can connect it to different ecosystems, including things that come down the pike and maybe IoT or blockchain Whatever, we'll see where that goes. But it can connect, you know, your systems to those systems. And it can, you know, you can configure what data needs to go back and forth, and you can apply workflow to the data. You know, so if you have to decline something, because it's, you know, out of your box or something, it's not a good fit, the workflow can be embedded right in there. So, so, so what it does is, is, you know, it puts the, the, the process to the front and it doesn't, you know, labor, you know, belabor the, the, the endpoint and all those things that people don't like to do. But, um, but I would say that the microservices are going to get more intelligent, they're going to be able to, you know, shake hands, say How you doing? Yeah, you're right, I'm going to do business with you. It's okay, you know, it's secure, and then they'll go off and, you know, do some exchange to get to the end result and I think that's where our microservices Well, you know, we'll lead as well and that would work.

Nick
What are the potential limitations for a company that is is does have significant legacy debt. Right with their IT, is interested in microservices thinks of it as like, Okay, this is we don't have to spend 10s of millions to do rip and replace let's go micro services. Is it possible for microservices to almost be like Robocop, you know, where you could essentially build enough of a scaffolding of microservices to extend it out indefinitely? Or do you see it as if the legacy debt is significant to you know, is there a limitation to what microservices can do in terms of extending and enhancing? Yeah, I think there's still a balance to be had there. Right.

Wendy C
Yeah, that's a good question. I, I would say that, you know, for us, it's all about being able to connect, right if, if your legacy system is not open, and it's hard to get data out of it, real challenge I can give you an example. And I'm not going to say what the system is or anything like that. But we had an opportunity to front end a legacy system, and we couldn't do it. And it's not because we're incapable it's just that the system, the system was all the all the rules, okay? So if you're going to front end a system, you got a couple of choices, you can either put the rules in the front end, in the portal, right in that user experience piece. And then you know, you're gonna have to maybe if they're in the other system you might have, they might be duplicate, right? But you don't really want to duplicate those rules. So if you have a system where you can get to the rules, or you have a rules engine, that's great, because, you know, I'm putting in data, you know, when you say, Okay, do you have a swimming pool? Yes. Okay, next question. Do you have a diving board? Yes. You know, now, what do I need to ask? Are you willing to remove it, right? There's a whole bunch of interaction that needs to take place. Some of those systems, the way that they're built, you can't get to the rules, right? It's part of the metadata and it's not, you know, separated. So that it's easy to connect to, you know, like being an XML or something like that. So for those types of systems, there's going to be challenges and making decisions. You know, are you going to be able to, you know, extend those systems or not, you know, if you if you want to, you might have to duplicate the rules. So not every single implementation of microservices is going to be cut and dry. Because sometimes it's hard to get to the information inside those systems because there's so entangled inside. Yeah, not all systems are like that. But there are systems that are there. So it's coming through those challenges. And I think that people are just going to have to make decisions. You know, if they want to play if they want to extend what are they going to be able to do? Most people can, you know, develop API's or some sort of JSON or XML feed or whatever that might be and then we were off and running. Not a problem. I would say the majority but there is that little limitation that we, you know, that we've come up against, and I expect we'll see it again. And those are the ones that we walk away from. Because there's, you know, it's you know, you make a decision, you decide what you want to do. And if you feel that that's you want to do it this way, this is the only way we can do it, then we're here otherwise, you know, we have to walk away.

Nick
Yeah, I have first hand experience dealing with something like that with a carrier I worked with, that had two different mainframe systems. That wasn't necessarily the issue. But they did they did convert they did a rip and replace on the accounting system. So the accounting system was much more modern, much better system. Yeah, but there was a divorce now between the policy information and the accounting information, and the our ability to reconcile the two pieces became a nightmare. For us, it was it we were always no matter what we do. Did we were always like 10 or 20% off 10 or 20% off on the exposure information, or we got the exposure information correct. And we were 10 or 20% off on the premium information, but we were always off on something. And so it was really hard to build models and other stuff on top of that, because everything was a, a long drawn out process just to make sure that we were dealing with good data. Yeah. Then you brought up the whole border row thing. And that was like a whole other like, exactly. Like we had to use a separate system to sort of manage a lot of the border. Oh stuff, because it's like, which one of these do we fully rely on and nothing was nailed down? It, it became really difficult to function in that environment.

Wendy C
Yeah, no, I mean, you have to make decisions, you know, some of those systems are going to have to go in time, you know, But, look, I've had conversations with CIOs that are very forward thinking in a very Old Fashioned environment. And so they know, they want to create a brand new infrastructure and microservices as part of it. Yeah, they're in some of these guys are up against the fact that one, you know, their management, you know, doesn't they don't want to make the investment. So they have to have what may make what they have work, right. And the other challenge I think that people are up against is that, you know, they have IT staff that want to build everything. Right. And so, so that we're up against that too. But, you know, we what we do is we try to educate, you know, the technology team that you know, these are this is a really good thing for the business and let's show you how and what how, what your role is here. But, you know, it's, um, because of all this legacy, spend and replacement, you know, you know, some companies can continue to do it over and over again. But there are a lot of companies like regional sized companies that just can't afford it. Yeah. You know, so that's a good fit for us. And you know, we're trying to focus on being like almost like the, you know, the moon around the Earth type of thing initially like, let's extend it let's let's add this, let's do this, although I will tell you on we have, we're just signing a deal for a full, complete insurance processing system, including border row that we'll have out by the end of the year. So there are you know, there are there but the thing that here's why we got the deal. There are other systems out there to choose from this company is a startup and it's you know, and so they don't have a lot of money obviously. And they are trying to roll out a system in pieces and parts because they just don't have the bandwidth number one to do all that work. They're going to do part of the process manually. So we're able to provide them with the system so that they can, you know, do that and data entry externalize aerating Plug it in, create will create a document then we'll plug in a rating engine, we can do those things in pieces and parts over time. And so because of that, that's why we ended up being a good fit for them because they weren't ready to do an all inclusive system all at once. Yeah.Yeah. So,

Nick
you know, when we you brought up, you brought up a good point, right. Like, which is, you know, AIG just signed a gigantic contract to replace almost all of their entire policy management systems. I think it was Duck Creek could be Guidewire. But it's one of those two,

Wendy C
I think it was Duck Creek. Yeah, I think

Nick
it was Duck Creek. Um, and, you know, you kind of nailed it. There. Very few companies in that up in that atmosphere. You know, AIG is gigantic. They have a big wallet, they can afford to do this stuff. I don't think you have to go that far down the scale in terms of size before it becomes a massive problem, like, they just don't have the type of resources to be able to spend that sort of money like an AIG does. And so there needs to be more options for those kinds of companies. The Mutual's, the Farm Bureau's. You know, the regional carriers that are just not in that category don't have the resources and have to kind of think, and then you brought up startups. And I'm like, Well, that makes sense to one of the advantage of startups is that they're bringing something unique to the table, right? So especially these new Insurtech startups are digitally savvy, they can build stuff, right. And so they probably want to deal with a system that they can build stuff and kind of play nice with the other systems and not have everything be be rigid, and how it's occupying space on their side. There's probably a huge need for That's been very understated for a long period of time.

Wendy C
Yeah. And I and I really believe that, um, you know, there, I think people do want to, you know, manage their own systems and be able to add products quickly. And, you know, we talked about speeds, and we've been talking about speed to market for, you know, 20 whatever years and, you know, I think certain things to have are, you know, are prone to the speed to market but most things are not, yeah, you know, because, you know, the, the take things take time, and people don't have the patience for things and, you know, to take time, but, but I think we've gotten kind of used to it, but it's some point. You know, there, I think that that will they'll We'll figure that part out. Um, you know, the insurtechs have to get stuff to market quickly. The startups have to have systems to process that opportunity. So, you know, that's why I think microservices are great for that. Because they are no code. You know, they they are drag and drop, it allows the business user to actually do the work. I mean, there is some it involvement. I remember when we started Duck Creek, you know, we used to say that the business analysts used to be able to do the work and that was our intent, you know, but we couldn't get the business analyst to do the work right. It just never ended up on the business side it usually ended up on the you know, on the end well and it or it ended up in Duck Creek because he's a massive projects that need people and it's hard to have a lot of people to these projects. But so I think microservices gives people an opportunity to to manage these projects themselves. And you know, if you need help you get help but you know, in potentially, you know, crack the speed to market need that we've been talking about for so long. You

Nick
know, the only thing we've been talking about longer than that is SEMSI. You know It's like we can keep dreaming. We're close. But

Wendy C
we will retire by the time that thing comes up again. What do you say? You're getting closer because I think you're in Florida now. Right? Isn't that like, closer to retirement? Right?

Nick
I am. I'm surrounded by retired people. So this have been a great conversation. I can't help but think what's OWIT stand for?

Wendy C
So OWIT stands for One World Insurance Technology. And actually the rural. The rural, the urban, I keep saying that the Urban Dictionary says, OWIT means Oh, I want that! And so we have this little our gear, had our OWIT Global gear, had guy gears, our gears represent those microservices. And it says, Oh, I want that. So, so hopefully,

Nick
I love that that is fantastic. I would be remiss If I didn't ask you about your career a little bit here, because you were with Duck Creek, which was a fantastically successful company still is, right? It was a great fantastic.. So I'm sure you did. I'm sure they took good care of you. So why come back? Why? What do you are you? Are you nuts? Like, what, what, what? What was the talk about the where, how you saw this and what made you be that crazy that you want to do this again?

Wendy C
Well, you know what, here's the thing. You know, I think we're a very, it's a very interesting industry, we have a tendency to do things that we know over and over and over again. When Duck Creek came or came along. It was a new way of doing things right out of the box thinking and I like that I've always been involved with high risk companies. For some reason, I just enjoy the opportunity. You know, knowing that the opportunity is I believe in what I do. You know, when I joined Creek, I totally believe in what the guys were doing. It was it was amazing. And you know, for this I mean, it's been, how many years I don't even. I think I started Duck Creek tooth, right? I actually started Duck Creek a month, like a week before the towers were hit. And I had left my solid job a job and I thought, oh my god,

Nick
what did I do?

Wendy C
And right? And I actually was in Balmour Missouri at the time, and I drove home with a consultant. Someone and you know, I drove home with with this guy, but it's been a long time why he's been, let's see, was it 19 years? And so, you know, it was time for some changes, you know, again, we get back into this, we are where we are, this is the type of industry we are we do the same thing over and over and over again. And this is really a nice refreshing, you know, way of making a change in the industry again, it's fun, right? And not only that, but I get to run The company which is like you know exactly what I wanted to do, I have a great team of people, we all roll our sleeves up every day. I have conversations with new new people with people I've known for my whole entire career. And so it's a very exciting time for us. And I think as we start to really educate the industry, on micro services, and their macro results, as we say that they'll get out of it, and people start to engage it, we're going to see a high high success rate. And I think we'll see more entries, you know, entrance into the, into the industry, just like we did a creek I mean, it's a creek, the we started making momentum, the other vendors started changing the way they they re engineered their products to be tool based, right. It was all coated before that. So yeah, I think I think I'm in it because it's just fantastic. You know, I love what we do, I believe What we're doing, we're doing the right thing. We're seeing the traction. It's exciting. When you see traction. It's exciting when you see someone be successful or you can help someone be successful. And it's great. The one of the things I love about this too, is that we get to create this really great work environment. You know, we have really smart people, everyone seems to be happy, you know, we check in with them. And right now, obviously, we're all virtual. We have a team, by the way, here in the US, we both 15 people. We have four people in the UK. That's a growing team. And then we have 20 people in Hyderabad, India, which is part of our team that are doing various work. We have a really nice group of people and we all interact across the globe. So I just think it's, it's fun. It was my phone. Hopefully, that's a

Nick
It's Hyderabad!

Wendy C
Ah, that was pretty funny. Um, anyway, so we were really we're really, um, we're doing it. We're really happy and Then this is this is the place to be. It's really awesome. So,

Nick
thank you for coming on. Thank you for having me. Thank you for your dedication to the industry in one room wanting to solve it. So surely this appreciate you so much coming on and having this conversation with me.

Wendy C
No, thank you And don't forget, oh, I Oh, I want that.

Nick
Yes, I actually i do want that. So

Wendy C
I'm going to send you we're gonna have to figure out how to get me one of those awesome.

Nick
Wendy Aarons-Corman of OWIT, One World??? One World?

Wendy C
OWIT Global...One World Insurance Technology,

Nick
or Oh, I want that!

Wendy C
Oh, I want that!

Nick
People won't forget that. Thank you so much.

Wendy C
Thank you. Appreciate it.

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