How Kim Berwanger built an insurer from scratch

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At the beginning of 2016, MetLife announced that it would spin off its U.S. retail business — that is, products not sold as employee benefits — into a new unit, Brighthouse Financial. The key reason: At its size, the company was subject to strategically important financial institution designation, which meant more capital reserving requirements. Separating some part of the company carried less competitive risk than keeping it together, but required leaders with adept skills in anticipating and addressing the many potential pitfalls of the move.

That’s where Kim Berwanger, SVP of IT for Brighthouse, has shined over the past 20 months. She made decisions on which systems Brighthouse needed to leverage from MetLife during the transformation, drafted transitional service agreements with MetLife and developed a vision for the future state of technology at the new company. Essentially, Berwanger had to create from scratch the IT environment for a company with more than $220 billion in assets. She was able to deliver in under two years, facing intense deadline pressure, so that the separation could be finalized and the next phase for Brighthouse Financial could begin.

“The separation of this portion of the retail business was based upon legal entity structure,” she explains. “The technical infrastructure and systems in our legacy Brighthouse Financial footprint at MetLife spans across 600-plus solutions, many of which are shared with MetLife. As we exit, we are setting up all new tech platforms.”

The case for cloud

Throughout the transition, Berwanger made the case for a more cloud-based IT environment, allowing the new company to eschew a traditional data center and leverage shared services to help reduce operational costs. There was a clear market reason: Two-thirds of consumers say life insurance is too expensive for them to consider buying it at retail, according to LIMRA’s 2017 Insurance Barometer study. Berwanger believed that rather than keep going with a traditional IT strategy, the company had the opportunity to change the operating model to a leaner, more service-based one. The savings allow the new brand to potentially offer lower-cost coverage to customers, opening up a new competitive angle.

“We’re focused on creating a lower cost structure,” Berwanger explains. “As we’ve seen in P&C insurance, pricing has become an important factor.”

Brighthouse’s more nimble IT environment, enabled by modern-era services, will also allow the company to innovate at a high level in those other areas, she adds. While Berwanger notes that the current state of machine learning and artificial intelligence capabilities for life insurance is not as robust as in the P&C industry, Brighthouse will be able to leverage opportunities to innovate more easily than it could in the past.

“It will be easier to plug in underwriting engines than it would have been historically, now that we have a simplified administrative platform,” she says. “Our complexity level to integrate new or innovative technologies into Brighthouse will be reduced.”

The company is also growing its own internal data science team to innovate on its own, and will benefit from having a single, centralized source of data to leverage in the future, she adds.

“[Data science] is a critical component of insurance going forward, and this transformation will give us a lift there,” Berwanger says. Traditionally, simply getting usable data for scientists to work with was a challenge, but “that should be cleaned up for them,” she continues.

Overall, Berwanger says that the difficulties of the split and the growing pains for what is essentially a new company are going to pay off in a big way for the retail life insurance business: “In general, we have an amazing opportunity that a lot of companies don’t get.”

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Cloud computing Analytics Life insurance MetLife Brighthouse Financial Women in Insurance Leadership