PaaS adoption in P&C Insurance
What is PaaS?
PaaS stands for 'Platform as a Service' in Cloud computing
world. It gives one level of abstraction over the basic cloud service offering -
IaaS (Infrastructure as a Service) by taking care of underlying infrastructure
so that the enterprise can focus on delivering business value to the end users.
Majority of the Cloud Service Providers (CSPs) offer PaaS
offering apart from IaaS offerings. Open source PaaS platforms like
CloudFoundry, Heroku and OpenShift are also popular.
Trends in P&C Insurance
P&C Insurance is undergoing tremendous changes
currently. There is huge pressure on premium costs reduction. New products must
be delivered to customers quickly to compete with the increasing number of
players in the market. Also, the local players and startups are turning out to
be big threats to large players in this area due to the local flavor they can
bring to the policies.
For the large players to stay relevant in the current market
environment, it's important that they embrace digital transformation. At the
core of this transformation journey is the agility from infrastructure procurement
to feature delivery.
The following will be the primary objectives of the digital
transformation journey of the large players in P&C Insurance sector:
- Reduced time to market
- Reduced infrastructure costs
- Reduced operational costs
- Improved collaboration of global teams
- Mobile first approach to new feature delivery
All the above will require the infrastructure to be globally
available at lower cost and the development processes to be very agile. So,
Cloud computing becomes the natural center point of any modern large digital transformation
journey. Large insurers started recognizing this important aspect and are
currently evaluating various cloud adoption options.
PaaS adoption in P&C Insurance
One of the challenges of adopting cloud in Insurance sector
is meeting compliance and regulatory requirements. It was relatively easy to
meet them with on-prem data centers and application servers as the organization
has full control over access etc. With public cloud, it's not easy to meet them
due to the nature of public cloud. Hence the insurers are opting for setting up
private cloud within their network with the infrastructure capacity provided
in-house.
To balance the regulatory requirements adherence and modern
computing pattern adoption, insurers are evaluating various PaaS options such
as PCF, OpenShift, Heroku etc. This gives the organization to build regulatory
compliant cloud and adopt modern methodologies like DevOps to meet business
objectives. These PaaS platforms also reduce the infrastructure maintenance
overhead for the organizations by abstracting the underlying infrastructure management
from the developers.
These platforms offer industry standard infrastructure
management options apart from the portability which is also one of the key
objectives of the organization. These platforms provide the opportunity to
avoid Cloud Service Provider (CSP) vendor lock-in and thus align with
multi-cloud strategy of the organizations.
Observations and recommendations
While most of these PaaS platforms do offer the above-mentioned
flexibility, they are primarily container driven platforms. So,
there will be few applications in large enterprise IT landscape that are not
good candidates for containerization. Re-engineering those apps would be
preferred option but that won't be generally done at the beginning when an
organization starts on modernization journey.
There will also be few data sources which the enterprise
would still like to host in isolation and they source data for some of the apps
hosted on these PaaS platforms. The access mechanisms are generally more secure
which need to be supported by these PaaS platforms as the security at container
and orchestration level also becomes key for overall security.
Based on the experience, adopting these PaaS platforms would
help insurers speed up their modernization journey apart from improving
developer's productivity. Respective enterprise level security patterns and
nature of data sources need to be considered before choosing a PaaS platform. Integration
with on-prem applications and the cost associated with such setups should also
be considered before going for PaaS instead of IaaS.
