HALE, England, July 15, 2013 /CNW/ - A business partnership forged
between Aquarium Software of Cheshire and global giant RSA's pet
insurance brand, Pets Plus Us, could signal the start of a whole new
way of UK insurers buying technology platforms. Unlike the standard
software business model in the insurance and indeed many markets -
whereby the technology firm charges a large up-front fee for deployment
and then charges 'per seat' for the number of people using the software
- the Aquarium model flips that conventional thinking squarely on its
In essence, the client only ends up paying for the software if they use
it. "We like to call it sharing the risk, but a phrase you are likely
to hear more of in the future is 'transactional revenues'", says
Aquarium's Sales & Marketing Director, Mark Colonnese. "Instead of
charging a huge fee up front and then charging for each user, we're
only interested in charging for the volume of policies sold or
renewed, or claims processed through the system. That way, unless our
software really works for our clients they are free to look elsewhere
or stay with their legacy platform with the vast majority of their
capital intact," he adds.
Aquarium and Pets Plus Us agreed to a novel 'transactional' deal
arrangement, where only modest initial financial commitment was
required. In return for its up-front development work and consultancy
time, Aquarium will get a fee for all the insurance business that Pets
Plus Us processes in the future. For Randy Valpy, 'Top Dog' at Royal &
Sun Alliance-owned Pets Plus Us, this meant he could concentrate on
investing in marketing, while for Aquarium, its efforts will be amply
rewarded as the client's business prospers.
"We only earn if our clients are successful - we get paid when our
clients get paid and this makes us deeply motivated to deliver a
solution that really works," explains Colonnese. "But it also means our
clients do not get trapped on outdated platforms. We have to keep one
step ahead of the game continually re-investing in our solution to
ensure ongoing client throughput which generates cash for us."
Pay-as-you-go technology models are not in themselves a brand new
concept, as Colonnese freely admits, however the traditionally
conservative UK insurance software market hasn't seen anything like
this at such a bespoke level before, as far as Aquarium and their
business partners are aware. "We've been developing and honing our
offering for several years and have been working with insurers, loss
adjusters, and claims management companies to get to where we are
today," says Colonnese. "We have yet to see any other mainstream
supplier offering insurance process management or claims management
software on a similar basis."
The proof of the pudding with all these things is in the eating; in the
case of RSA, they overlooked bigger players in Australia and Silicon
Valley in taking a firm stand as a cheer-leader for Aquarium's model.
"For us it was a real no brainer," said Randy Valpy, "We picked Aquarium
after sifting through several rival technology companies globally. Some
were too expensive, others based on technologies that have a
questionable lifespan. They were simply not fluid enough for us,"
comments Valpy. "Or not scaleable enough. You can get similar
transactional models elsewhere but the solution you're offered is 'one
size fits all', not tailored to your precise needs. What Aquarium has
provided is unique to us and that was absolutely key."
Freeing up capital for growth
With a track record in developing and delivering P&C (Property &
Casualty) systems for large UK insurers such as Capita, including work
on their pet insurance business, Aquarium could offer Valpy a bespoke,
highly responsive service, more cost-effective than some rivals but
specific enough to deal with the many complexities of the burgeoning
pet insurance market.
"With Aquarium we've invested in what I believe is a Rolls-Royce
solution, when initially we only needed the Volkswagen," said Valpy,
alluding to Aquarium's mega capacity, which he fully expects to need in
the coming years.
"At the end of the day we had a simple decision to make. Once we had
done our due diligence and confirmed Aquarium were a suitable and
stable partner with which to do business, the decision was clear: With Aquarium we would free up spend for marketing and only pay
Aquarium revenues if our business grew at the rate we hoped; with the
other offers on the table, the marketing budget would have to be
dramatically curtailed and we would still end up paying a major chunk
of cash regardless of the success of the technology or indeed our own
new business venture."
Colonnese adds: "Thanks to the investment we have made in R&D our
technology platform can uniquely offer a solution that is tailored to
each of our clients' needs quickly, and without huge up-front capital
investment. This is what makes us really different."
Photograph and caption
Pictured: Randy Valpy, Top Dog of petsplusus.com (a subsidiary of RSA),
and Mark Colonnese, Sales & Marketing Director of Aquarium Software of
Hale, Cheshire (near Manchester).
SOURCE: Aquarium Software
For further information:
Jon Gardner, BeyondPR
t: + 44(0)114-275-6996
m: + 44(0)7930-697773