ICICI Lombard's digital transformation journey: A shift towards Cloud

ICICI Lombard, a key player in India's insurance sector, is undergoing a significant digital transformation, reflecting broader trends in the insurance industry. This transition involves shifting from traditional practices to modern, technology-driven approaches aimed at improving efficiency and customer experience. 

ICICI Lombard embarked on its digital journey in 2007 by becoming the first insurer in India to sell general insurance policies online. This early adoption set the stage for future advancements. By 2011, the company integrated digital imagery into its motor claims process, followed by the introduction of drones for site inspections. These initial steps paved the way for more extensive digital innovations. 

A major milestone came in 2019-20, when ICICI Lombard reassessed its technology strategy amid evolving digital trends. The company decided to transition fully to cloud computing, a shift necessitated by the limitations of legacy systems that had become obstacles in leveraging newer technologies. 

Cloud Computing: The Backbone of Transformation 

ICICI Lombard began its journey with cloud technology in 2013, initially for development and testing. By 2014, some production systems were transitioned to the cloud, but it wasn't until 2019-20 that the company undertook a full-scale migration. Partnering with Amazon Web Services (AWS), ICICI Lombard completed the migration around February 2022. 

“The migration process, known as a ‘lift and shift.’ involved moving existing systems to the cloud without initially altering them. This approach allowed the company to quickly transition from on-premises systems to the cloud, with the plan to subsequently modernise applications,” said Girish Nayak, CTO, ICICI Lombard. 

He further shared that the shift to cloud computing allowed ICICI Lombard to scale its operations efficiently and manage large volumes of data. It also provided the computational power necessary for advanced technologies like Artificial Intelligence (AI) and Machine Learning (ML).   

Nayak said, “AI has been instrumental in automating and streamlining processes such as handling lapses in motor insurance policies, where customers can now upload photos instead of undergoing physical inspections.” 

Modernising Core Systems 

Alongside cloud migration, ICICI Lombard has been modernising its core systems. Historically, the company operated with fragmented core systems that performed various functions inefficiently. To address this, the company launched a core transformation project to consolidate these systems into a unified core. 

The Project Orion, involves redesigning business processes to align with current technological and market needs. The goal is to ensure that the new systems and processes reflect the modern business environment rather than outdated practices.  

Leveraging Advanced Technologies 

ICICI Lombard’s digital transformation also includes the integration of emerging technologies. The use of Internet of Things (IoT) technology is a prime example. For motor insurance, ICICI Lombard employs IoT-based policies that track driving behaviour via onboard devices, offering discounts on premiums for safe driving. IoT also plays a role in monitoring vehicles through GPS to manage loss ratios effectively. 

Nayak shared that the company is also exploring advancements in Generative Artificial Intelligence (GenAI) to enhance customer experience and operational efficiency. For instance, AI-driven solutions have significantly reduced the time required for cashless hospital authorisations from up to 90 minutes to under two minutes. 

Adapting to New Operational Models

The shift to cloud technology necessitated substantial changes in ICICI Lombard’s internal operations. The company expanded its tech team from about 80 to nearly 400 engineers, transitioning from reliance on external vendors to building an in-house development team. This move was crucial for fully leveraging cloud capabilities, said Nayak. 

Additionally, ICICI Lombard established a product management function, adopted agile development practices, and set up a testing center of excellence. The adoption of DevSecOps, which integrates security into the development process, further underscores the company’s commitment to maintaining high standards of quality and security in its operations. 

He further said, “These changes in our operating model were essential for successfully transitioning to the cloud. Without them, our cloud migration would have likely failed.” 

Despite the transformative progress, ICICI Lombard faced challenges. Transitioning to a cloud-based model required significant adjustments in operational and development practices. However, these challenges were met with strategic changes that enabled the company to manage costs effectively even amid growth, as per Nayak. 

Looking Ahead 

ICICI Lombard plans to continue leveraging advanced technologies to further enhance its services. The ongoing core transformation and modernisation efforts are expected to solidify the company’s position as a leader in the digital insurance space. The company remains focused on aligning its technology and business processes to meet evolving customer expectations and industry standards, said Nayak.