Rick Madock, co-founder, Paradox Technology Solutions
Rather than basing the question on the size of the organization to determine if best-of-breed is the better approach, perhaps we should consider what the carrier is trying to accomplish. Just because an organization is small or midsize doesn’t mean their options should be limited.
Why not focus on the ‘best fit’ for a carrier? The best solution may depend more on the insurance line (or lines) of business rather than whether the solution is best-of-breed or end-to-end.
With a best-of-breed or point solution approach, buyers choose the best package in a functional category (i.e. claims, billing, policy) with the goal of achieving the ‘best-of-all-worlds’ once the various components are each implemented and working together.
Unfortunately, this approach often requires extensive customization and integration effort in order to fit a carrier’s specific needs. If there is not a suite or all-in-one solution that fits the bill, this may be the only option—short of the carrier building it themselves, but that’s a discussion for another time.
On the other hand, integrated suites, sometimes described as enterprise class solutions, are designed to offer end-to-end functionality—one-stop shopping if you will. These all-in-one solutions are now being designed more and more with a particular line of business in mind—for example, workers’ compensation—making them a good fit for any size carrier with that particular line of business.
So, the real question isn’t the size of the carrier or whether the better approach is best-of-breed or all-in one, but rather what is the carrier trying to accomplish and for what lines of business?
(Rick Madock can be reached at rick.madock@ptsinsurance.com)