The Life Company Central (LCC) initiative has seen many changes in the last few months, and it is once again taking on a new direction.
The project has appointed a new leader, IBM Canada a pioneer in the project is taking a step back, and FundSERV, the mutual fund equivalent of LCC has been called upon to help.
Dennis Craig, Vice-President New Business Services at RBC Insurance has taken over as Chair of LCC, he will replace Doug Smeall, Vice-President of Life Operations at Sun Life. Mr. Craig explains that the change in leadership is due to Mr. Smeall leaving his position at Sun Life.
There are six companies contributing financially to LCC: Sun Life, Canada Life, Transamerica, Standard Life, RBC Insurance and Manulife. The project goal is to develop and implement a common electronic interface system between suppliers of insurance products and their distributors, something similar to FundSERV, but for life insurance.
This is the second change in leadership for the committee. In February, the committee saw the departure of a key member and the role change for another. Richard Miles retired as Co-Chair of LCC and now serves as the LCC spokesperson. When Mr. Miles stepped down, Mr. Smeall took over as the sole Chair for the project. During the same timeframe, Mark Fujita, stepped down as Principal, Insurance Services and Solutions at IBM Canada.
However, IBM Canada has taken a step back in the initiative says Mr. Craig. IBM was given the mandate of creating a prototype and drew up the estimated cost for the whole project. IBM’s prototype proposal was costly however, leaving the insurers involved feeling uneasy, notes Mr. Craig. It was estimated the prototype carried a cost of between $2 and $10 million.
“We haven’t been too active over the last few weeks…[LCC] is looking at various vendor solutions. We fulfilled our responsibilities and we recommended to the committee that they look at alternative solutions,” says David Kerr, Industry Executive at IBM Global Services.
Mr. Kerr explains that IBM is still very excited about the initiative and remains interested in guiding the project.
To develop the model, Mr. Craig says that LCC is now working closely with FundSERV and DSPA Software Inc. FundSERV already provides services to some insurers involved with LCC and to distributors on the mutual fund side. It will aid with the technical aspect of the project. DSPA is a provider of compensation processing for some LCC insurers. Mr. Craig explains that instead of building everything from scratch, existing infrastructure will be used to build the project.
“The proposal which involves FundSERV looks much more positive and in line. IBM may be asked to quote when we’re looking for some of the project pieces, but in terms of guiding it, the meeting was with FundSERV,” explains Mr. Craig.
He adds, “There is a high energy among the insurers. They are much more confident in the direction of the project and we’ll certainly be increasing the pace.”
To further speed-up the initiative, a full-time business analyst will join the LCC team says Mr. Smeall. The person will be dealing directly with the involved insurers and distributors. The business analyst will answer any concerns the insurers may have and will also be responsible for developing a financial model.