Allianz opens its platform with the help of Microsoft Azure

Almost two years after Allianz provided the core of its self-developed software "Allianz Business System" (ABS) as open-source software for further development and external use, the Group is now taking the next important step towards market opening. The open-source ABS platform will be available as a public cloud solution based on Microsoft Azure in the future.

Allianz and Microsoft have agreed on a partnership for this purpose. Together they want to become one of the leading software providers in the insurance business. Their goal is to offer an insurance platform that meets the requirements of digitization and automation, as well as related services. To this end, the core of the ABS platform will be offered as an open-source solution on Microsoft Azure. The core comprises basic functions, such as for the administration of contracts and customer data.

As part of the partnership, Allianz has sold 10% of its stake in its software subsidiary Syncier to Microsoft. Syncier manages ABS and is responsible for further developing the software in line with market requirements. In addition, Allianz intends to sell additional shares to Syncier and retain only a minority stake. According to Allianz, talks are already underway with other interested parties.

Allianz-insurance-ecosystem

Figure: The core of ABS is open source. Around it there is a layer for customer-specific processes and an outer layer for the integration of external solutions.
Source: Allianz.com

It is important for the success of the offer that Allianz does not act as a dominant partner, but nevertheless contributes important industry and process know-how for further development. So far, the offer has not been very successful in terms of external insurance customers using the solution: Insurers fear the dominance of Allianz. Further criticism said that the ABS core was too powerful and complex for smaller insurers. 

Syncier will also offer a marketplace for ready-to-use software applications and services specifically for the insurance sector via Microsoft Azure. Examples of such solutions include customer service chatbots or AI-based fraud detection. The marketplace allows insurance providers to quickly and easily implement the available solutions through plug-and-play. 

Allianz, Microsoft and Syncier are now required to continue to work on modularizing, modernizing, automating and opening the ABS core while at the same time making it secure and reliable. It is important to build an ecosystem of software vendors that can extend the functionality of the insurance platform through standardized interfaces.

Basically, the idea of the entire platform in the public cloud, including its development tools (PaaS, DevOps, REST APIs etc.) and infrastructure resources (IaaS), points to the right environment for a modern insurance solution. The need for innovative, digital platforms is definitely there for many insurance companies worldwide, and the regulatory requirements for cloud operation have been specified worldwide in recent years. It is exciting to see whether the traditionally conservative insurance industry is ready for an open-source, API-based public cloud platform. Given the competitive pressure from digital insurance and InsurTechs, insurers should be ready.