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Web Services Connection

Web services-based technology promises to help insurers extend the lives of legacy systems, lower IT maintenance costs and ease systems integration. But a lack of standards is slowing adoption.

Q: What is the next step in insurers' adoption of Web services? What are the obstacles to wider adoption?

A: Denise Garth, ACORD: The next critical step is organizational commitment to standards. The current lack of standardization for the technical infrastructure aspects is a hindrance to further adoption. Web services protocols and security, for example, are needed to enable the industrywide adoption of business data/message standards like ACORD and create a true plug-and-play environment. Organizations need to commit to a standards strategy that includes business processes, data and messages for the enterprise to position Web services as part of business transformation.

A: Brad Levine, Blue Frog Solutions: The insurance industry's use of Web services should continue with an increased velocity as more applications connect to each other with a plug-and-play approach that enables customers and business partners to do more business faster. The obstacles continue to be the use of proprietary protocols and solutions, as well as the lack of universal adoption of standards such as ACORD and DTCC. However, we also see the adoption of standards increasing at about the same rate as Web services.

A: Chris Kurt, WS-I/Microsoft: The next phases of development will be graduation from single purpose pilots that utilize a few Web services and may be completely internal to the true value of the long-range vision - a greater orchestration of multiple Web services, provided by several sources, into hybrid, cross-enterprise, cross-platform, workflow applications. The primary obstacles to adoption are getting a handle on the current state of both the WS-I standards as well as the industry-specific messages, and moving from prototype and pilot phases to a truly architectural approach. That requires a long-range view and a broader corporate commitment.

Q: In what areas are Web services having the most impact for insurance companies? What are the benefits?

A: Garth, ACORD: The industry has made great strides in refurbishing legacy systems by taking out common business processes and creating Web services. Examples include licensing and appointment and quoting systems where companies may have multiple systems. Web services help them streamline and refurbish these critical areas. The benefits are extending the life of these systems while creating a modern, efficient infrastructure.

A: Brent Littleton, Security Benefit: Web services allow most companies with legacy systems an easier way to interface mainframe applications. Companies that have moved to a distributed systems environment obtain the benefit of utilizing single-enterprise Web services that cross the entire IT framework. Companies that implement this strategy reduce maintenance costs, increase system performance and generally maximize efficiencies.

A: Levine, Blue Frog Solutions: Multiple systems on multiple platforms and the adoption of Web services address a significant business problem for insurers by reducing or almost eliminating the burden of systems integration. Those companies employing Web services can, over time, develop a simple, reusable systems integration methodology for both internal and external systems for all aspects of their business.

A: Kurt, WS-I/Microsoft: Most of the early development has been in the area of providing wrappers and front ends for legacy applications, and in the accessing and inclusion of third-party syndicated data sources into applications and workflow. Benefits include the creation of better point-of-sale applications that, unfortunately, bring with them the curse of being Web-enabled expressions of siloed applications. That development has been closely followed by product configuration tools and rating engines that are built around Web services to ease integration with a variety of point-of-sale applications. The move from these siloed expressions into better hybrids will begin to bring out the true value of Web services.

Q: What architecture/infrastructure requirements must insurers address to maximize the benefits of Web services?

A: Garth, ACORD: First, companies must examine their enterprise architecture that includes business process, data, messages and infrastructure. Then, they must recognize that adopting standards-based components for these will provide the foundation for Web services instead of multiple, proprietary, one-off solutions. This is not only for efficiency but for cost-effectiveness, quality and consistency of information. Web services require the adoption of standards for security policy, protocol encapsulation, identity and policy.

A: Littleton, Security Benefit: We didn't truly realize the benefits of Web services until we migrated from a mainframe legacy environment to the distributed systems environment. We maximized the benefits of Web services through the development of enterprise applications. These enterprise applications allowed us to consolidate business processes in a single application across multiple product lines and administrative systems, such as commissions, billing and image workflow. By using these systems, we've lowered our overall platform costs, positioning us competitively to identify business opportunity outgrowth for processing end to end for others.

A: Kurt, WS-I/Microsoft: The overall commitment to service-oriented architecture requires the education of business leadership as to how to express their desires for workflow and application functionality in ways that IT can model into Web service applications. Both sides of the house need to come to the table for educational and strategic planning activities that will allow business goals and objectives to be fulfilled by the creation of Web services-enabled business processes.

Q: How can the insurance industry facilitate further adoption of Web services?

A: Garth, ACORD: Companies need to implement an enterprise business architecture approach - from data to messages to processes. Technical issues of security, authentication and reliability will need to be addressed. Industry standards such as ACORD also must be adopted to ensure a lingua franca across the value chain. Once more companies adopt standards, more vendors will develop solutions, increasing utilization throughout the industry. This will create consistency, and companies will be able to leverage and reuse data.

A: Littleton, Security Benefit: There needs to be broader participation by all carriers of all sizes, not just the larger carriers. Industry standards, such as ACORD, need to become more streamlined and more cost-effective to implement. What's exciting is the movement we're seeing in this direction. Further, leadership and vision are crucial for success.

A: Levine, Blue Frog Solutions: We already are seeing industry utilities such as the Medical Information Bureau (MIB) adopt and require the use of Web services. As this trend expands and more applications use them, we should begin to see a viral effect take place in the industry. In addition, implementing existing, proven, highly structured and yet flexible tools and solutions that have built-in industry standards and regular software upgrades - along with common system(s) plug-ins that shorten time to market, will allow more widespread use of Web services in the insurance industry.

A: Kurt, WS-I/Microsoft: The industry's unique messaging standards need to be developed in ways that allow for better decomposition of large schema into lighter-weight message sets that can easily become the payloads for Web services data exchanges. The theme of migration to a new way of thinking about standards and application development takes time and requires both patience and industry leadership to bring about successfully.


The Experts: Web Services

Denise Garth

Vice President, Membership and Development


(Pearl River, N.Y.)

Brent Littleton

2nd Vice President and Director of IT Applications

Security Benefit

(Topeka, Kan.)

Brad Levine


Blue Frog Solutions

(Pompano Beach, Fla.)

Chris Kurt

Board Member, Secretary

Web Services Interoperability Org.

(WS-I; Wakefield, Mass.)

Group Program Manager Microsoft

(Redmond, Wash.)

Peggy Bresnick Kendler has been a writer for 30 years. She has worked as an editor, publicist and school district technology coordinator. During the past decade, Bresnick Kendler has worked for UBM TechWeb on special financialservices technology-centered ... View Full Bio

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