Star Union Dai-ichi Life Insurance Powers Mission-Critical Group Policy Management System on JBoss Enterprise Middleware

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November 2, 2010

Customer: Star Union Dai-ichi Life Insurance Company Limited (SUD Life)

Industry: Insurance
Geography: APAC
Country: India


Software:

JBoss Enterprise Application Platform, SQL Server database

Hardware:

Intel xeon processor-based servers from HCL and IBM

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Background:

Business Challenge:

Since its inception in February 2009, SUD Life has focused on technology innovation to achieve better operational efficiency and in turn serve its customers more efficiently. Therefore the company outsourced the IT functionality of the core insurance product LIFE/Asia to CSC. LIFE/Asia is responsible for the individual life insurance business for SUD Life. Simultaneously, the IT team also started conceptualizing other systems required for business support, one of them was the Group Life Insurance policy administration system.

SUD Life launched Group Life Insurance products for its corporate customers. The organization required a flexible, cost effective software solution for Group Policy Management. There were a few challenges in building the system for group products. Group products are different from individual products, and hence cannot be maintained on an individual policy administrative system like LIFE/Asia. Secondly, each group product is different in structure and operation to the other in parameters such as Group Term, Group Gratuity, and Group Superannuation amongst others. “The group policy business may not be as large as the individual policy business, but to build an automated system for it is equally complex due to different product structure, variety of policy options and possibility of adding newer offerings at regular intervals,” said Harnath Babu, head IT, SUD Life.

In the beginning, the group insurance policy administration was being done using Microsoft Excel, which turned out to be increasingly inefficient as the business grew. “There was a serious need for policy servicing, maintenance, reporting and calculation automation,” said Harnath. Thus the IT team decided to implement a complete Group Policy Management system encompassing complete lifecycle of a group policy including; Quotation, New Business, Policy Servicing, Renewal, Member administration, Premium Calculation, Refund and Claims. A critical requirement was that the application required flexibility to implement a variety of group products, and also so the application would have the capability to integrate with its business intelligence, reporting, accounting and investment applications.

With these requirements, the IT team of the organization started evaluating different options for implementing the Group Policy system.

SOLUTION

Solution:

“We ruled out the proprietary products available in the market for a couple of reasons,” said Harnath. “One was that it was exorbitantly high priced, close to INR 50 millions, because of its specific hardware needs,” he added. The second reason was the fact that few of the available products in the market were CUI based and not web-based. “We wanted flexibility in the platform in order to modify it per business requirements in addition to adding newer modules to it at a regular interval,” said Harnath. With a lack of an off-the-shelf web-based group policy system in the Indian market, the organization decided to build the system from the ground up, within a phased approach to keep adding and enhancing the feature-set. “Our team needed to have complete control of not only the domain, but also the requisite technology management skills to execute this ambitious initiative,” said Harnath.

SUD Life chose Arion Systems, a Red Hat partner in India, to design and develop the entire Group Policy Management system. In consultation with Arion Systems, SUD Life designed a comprehensive roadmap to build the system using an open sourceJ2EE software infrastructure. “We ruled out competitive platform due to scalability and performance issues that we had encountered with it in the past,” said Harnath. SUD Life wanted a system that would enable a user-friendly browser-based interface, and would also reuse its existing software and hardware infrastructure. The next logical step was to choose an appropriate middleware platform which is the most critical component in any web based system. “Because the application would be hosted as an enterprise application, we decided to deploy it on an application server instead of web server,” said Harnath. SUD Life’s IT team began to evaluate the appropriate application server that could fulfill its enterprise needs.

With the parameters such as reliability, scalability, cost, performance, manageability and flexibility, SUD Life’s IT team chose Red Hat as its trusted technology partner and decided to build its middleware infrastructure solution based on Red Hat’s JBoss Enterprise Application Platform. JBoss Enterprise Application Platform was an ideal fit as it not only met these criteria, but also allowed SUD Life to take advantage of the rapid innovation from the open source community and avoid proprietary vendor lock-in.

“Implementation of the Group Policy Management Application based on JBoss Enterprise Application Platform was one of the key milestones in our IT deployments as it was the first time SUD Life was implementing an open source solution,” said Harnath. The POC done using JBoss Enterprise Application Platform was highly successful, raising the confidence of the IT team to choose it as its middleware solution. Red Hat’s subscription model also provided SUD Life with a predictable total cost of ownership (TCO), while also ensuring that SUD Life was able to derive continuous value even after initial rollouts.

The system was designed and developed in a just three months. “The system is web-based, and its user-friendly interface has minimized the time required for application training to operations users to just about a week,” said Sandip Chintawar, chief executive officer, Arion Systems. The system is also parameterized to easily configure new products. “The system is flexible enough for us to design new group insurance products, add them in the system and deploy them within just one month,” said Chintawar. JBoss Enterprise Application Platform’s flexible and scalable architecture helps the IT team in this regard tremendously. “With the JBoss platform providing services like clustering, failover, and load balancing, my IT team has more time for other high priority tasks,” said Chintawar.

Along with the Java programming language and JBoss Enterprise Application Platform, the system uses SQL Server database and Microsoft Windows. Currently, the system is used by the in-house data entry users and certain employees of the two banks in the joint-venture who download the insurance certificate for issue. To date, the system has a database of approximately 18,000 group policies/lives. “We expect it to grow it to about 50,000 in a couple of months,” said Chintawar. Currently, the system is handling various types of group policies such as Group Mortgage Reducing Term Assurance (MRTA), Group Savings Linked Insurance (GSLI), and Reverse Mortgage Linked Annuity (RMLA) amongst others. “The system is performing excellently with no unplanned downtime to date.”

In the future, SUD Life is planning to build a Group Portal on JBoss Enterprise Portal Platform in order to provide login access to the policy holders who, in turn, are the end users. “We want to implement basic business rules capabilities in the portal by designing a rule- based engine,” said Chintawar. Currently, the rules are entered and modified at a database level. “We would evaluate JBoss Rules Framework for this purpose,” he added. SUD Life is also planning to build its intranet portal on JBoss Portal Platform and e-Procurement system on JBoss Enterprise Application Platform. “Knowing that JBoss platforms run optimally on Red Hat Enterprise Linux, we are also actively looking at migrating the underlying Microsoft Windows operating system to Red Hat Enterprise Linux for the Group Policy system,” said Harnath.

BENEFITS

Benefits:

“With JBoss Enterprise Middleware, we were able to reduce the Total Cost of Ownership (TCO) of the Group Policy Management Application significantly,” said Harnath. “Through the use of Red Hat’s open source technologies and the implementation of open standards, we have achieved nearly 70 percent savings in costs as well as greater operational efficiencies compared to traditional approaches,” he added. The Java based solution running on JBoss Enterprise Middleware also freed SUD Life from proprietary vendor lock-in, and enabled the organization to choose commodity hardware platforms that delivered flexibility and high performance.

The solution further provided SUD Life with simplified management, reduced systems maintenance, and increased scalability and performance. The system was designed and developed in rapidly, which has helped the organization in its aggressive go-to-market strategy.

The JBoss Enterprise Application Platform, in particular, and the overall system in general is flexible enough where small changes can be accommodated quickly. “It also helps us to introduce new offerings with the confidence that the product can be quickly deployed within the system,” said Harnath. A good example was the introduction of unique RMLA policy by SUD Life, which became a market success.

Overall, Red Hat and its partner Arion Systems provided SUD Life with enterprise-class solutions at an affordable price and increased scalability and performance. “The solution has not only reduced costs, but has also made our business agile enabling it to react quickly to the changing business needs giving us a competitive edge,” said Harnath.

About Arion Systems:

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