APIs Enhance Insurance TPA Services

Bob Kiep, SVP, Chief Architect, Gallagher Bassett and Kirti Vaidya, Vice President, Business Architecture and Transformation, Gallagher Bassett
Bob Kiep, SVP, Chief Architect, Gallagher Bassett

Bob Kiep, SVP, Chief Architect, Gallagher Bassett

Gallagher Bassett Services Inc. asked itself a straightforward question: What if clients could connect their websites, or mobile and other applications directly to Gallagher Bassett and exchange data like details of a claim or list of payments?

The answer provided by Gallagher Bassett, which is a third-party administrator (TPA) to which insurers and self-insured entities outsource managing medical, workers compensation and other types of claims, was its application programming interface (GB API) offered via its public API Developers’ Portal.

GB API allows clients to access claim related data on demand through direct connectivity between client applications - be they web-based, mobile, IoT, or others – and Gallagher Bassett’s applications.

In a traditional exchange of information, a TPA sends files to clients and receives files, or sends and receives data using electronic data interchange links that have been custom-designed. The API makes this connectivity more standard and direct. At a technical level an API is a way for companies to allow other companies to connect to their applications through well published specifications. However its importance at a business level is what must be clearly understood -the API is a Business Capability that companies create to help them penetrate markets and do their business better. GB API allows Gallagher Bassett to publish TPA capabilities that it offers to clients and vendor partners.

Gallagher Bassett is a provider of risk and claims management services worldwide. The company offers services to globally-connected businesses that strives to overcome the challenges of ever-accelerating pace of innovation 

Client developers browse Gallagher Bassett’s API Developer Portal and select APIs that they might test in a sandbox. The APIs are described as technical contracts – very clear in what parameters they need and what data they will supply. The developers write programs that call the APIs. This learning and development effort is what clients must plan to invest in, to be able to leverage the ensuing efficiencies. When clients want status of a given claim, they call an API that gives claim status. They give GB API the claim number and depending on their security authorization, they can get the requested information on an almost real-time basis. If there’s a change in certain claim or policy data or payment data, the API can send back the changed data. The process becomes more real-time, more on-demand, more relevant, creating an enhanced relationship that both parties enjoy. The API is treated as a product with associated versioning, specifications, guarantees, security, and support.

The result is an operation that creates efficiencies across the board in every step of the process.Kirti Vaidya, Vice President, Business Architecture and Transformation, Gallagher Bassett

No single program or single database is responsible for answering the API call, it could be just one program or it could be a multitude of these systems—essentially what goes back is a response that showcases Gallagher Bassett’s capabilities.

In a way APIs will push a culture change in the insurance sector. The availability of APIs is particularly critical because of the growing number of InsureTechs, which seek to create new efficiencies in the insurance sector by using technology to accomplish such goals as to better manage policies and enhance customer satisfaction.

The InsureTechs are building systems from scratch, which is a stark contrast with Gallagher Bassett’s other partners whether they are current carriers or other client types. InsureTechs expect and are probably only capable to speak the language of APIs.

For InsureTechs, it is almost a given that they would have to depend in the future on TPAs with APIs, which essentially goes back to the speed of settlement. The InsureTech needs the systems to talk to each other quickly right now, right here. In response, Gallagher Basset is filling the lifecycle with more APIs over time.

In contrast, some of the older firms continue to use the technologies that preceded APIs. The attitude is “If It ain’t broke, you ain’t  gonna go back and modernize.” The result is inertia, which underscores the importance of Gallagher Bassett having APIs to support the modernization happening in the insurance sector.

Ironically, it wasn’t an InsureTech that got the API ball rolling at Gallagher Basset. Instead, a vendor partner said nearly five years ago that it wanted to build its own user interface using data from Gallagher Bassett. The APIs they developed for the partner had a lot of reuse, so the developments weren’t exclusive to a single vendor and Gallagher Bassett decided it could go public and share the information through a developer website, which turned out to be GB API, launched in June 2018.

There is, however, a split in industry- -and not just insurance--over the desirability of maintaining a public website for APIs. Some firms say they need to go out and have a public website, while others say nobody really came to the site, and it represented too much work and they take it back private. They kind of ping pong. They have a public site and then the public site disappears. And then they go back to being public again.

Where’s the pendulum today? Public? Private? We don’t know.

And clients don’t always know what they want from an API. They say they want APIs and they want help to get started. They need to know what they need to do to make their business better. They have to have a business purpose for doing this.

For the insurance TPA, that business purpose is clear. API reduces the barrier to do business with them by offering clients ready connectivity; and gives the TPA the capability through which they could offer enhanced services in a more real time, on demand fashion. That benefits their existing clients and also, attracts the InsureTechs.

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