Mechanic for the Modern Age

Aspects of the insurance world are stuck in the 1960s, but Mary Kotch is implementing twenty-first-century tech at Validus to boot up company growth through innovation

On any given day, Mary Kotch is in search of better technology.

She’s constantly networking, reading, and reaching out to find the next innovation in technology. She recently traveled to the 2016 CIO Insurance Summit in New York, where she spoke about women in technology and collaboration with other chief information officers and chief technology officers. All of these facets are what put Kotch ahead of the game in the insurance-technology sector.

Mary Kotch, Validus Holdings Ltd.
Mary Kotch, Validus Holdings Ltd.

Kotch first fell in love with technology as an undergraduate at Penn State University where she was taught Fortran coding. She used to collect stipends for creating databases. “I fell in love with aggregating data, looking at it, and doing statistics with data for professors,” Kotch says. “It got me a fellowship into Temple Law, and I continue to do that work.”

From there, Kotch continued to teach while landing her first job with Fortune 500 company MetLife. She eventually worked as the CTO for insurance giant AIG. Being a former CTO has helped Kotch excel as CIO for Validus, she says. Her tech know-how and expertise are putting Validus on the cutting edge, when most insurance systems are outdated.

“I come from a technology perspective, and I still find some of the operating companies we work with that have legacy systems,” Kotch says. “That’s not unheard of in the insurance world today.”

Many companies are in this predicament because of legacy portfolios like VSAM and COBOL developers. The baby boomers are retiring, and the younger insurance startups cannot find the skill set to modernize these systems. Validus is tackling that predicament by building its core systems through a multiyear plan. Kotch and her team will spend the next three years overhauling the legacy by looking at solutions through outsourcing or buying packet solutions.

Kotch’s team is also creating a technology plan that includes opening up new data centers globally and retiring legacy technology. “It’s creating a new global network and ease of doing business inside Validus for business associates and our customers,” she says.

These developments are all part of the plan to build the office of the future, according to Kotch. She’s going to overhaul all the technologies and securities at the forefront, which includes a new security-operations team. She’s got some of the best vendors in the industry monitoring environments. She’s also working on regulations and cybersecurity, which are both becoming increasingly important segments in insurance technology.

On top of that, Kotch is looking to work with Amazon in having a private cloud for the research team. In order to deliver on that, Kotch has a talent-management program in place that consists of training, coaches, and mentors. “I don’t believe in just ripping and replacing the talent. I believe in building it up,” Kotch explains. “Attrition rates are low. We’ve got the right IT hubs for employees and locations, and we’re expanding on that.”

The global CIO is a strong believer in having a good mix of people, because she says long-standing employees can learn just as much from new hires as college graduates can learn from the baby boomers. Kotch also spends time with universities speaking to college students and encouraging more women to join the field of information technology. When Kotch is not at work, she coaches soccer for her daughter and teaches a coding class at school for her son.

Talent management has always been a key focus for Kotch, and it’s been hugely successful for her in the past. Technology is on the forefront, but Kotch says it’s not the driving force. It’s about training employees and spending time with them to get them motivated so they don’t make mistakes, and about introducing new opportunities.

At Validus, that starts with tabletop conversations as well as digging deep into finding holes and solutions to fill them. That’s where Kotch finds results. “Being a global CIO, you have to be able to communicate. You have to be visible, you have to be out there, you have to influence, and you have to do so much to help transform an organization,” she says. “Throughout my career, the decisions I made were based on that. It’s the journey that I’ve decided to take.”

The insurance industry as a whole has turned to hiring PhDs, mathematicians, statisticians, and climatologists to redefine the industry today. Validus makes such hires as well, looking at risk through the lens of policies by location, geography, and other aspects. The company can take a hurricane perspective to provide a level of analytics back into the business to redefine risk management.

It also brings a new level of product development. “It’s not about creating these large data warehouses anymore,” Kotch says. “It’s about just managing the risk of how we’re underwriting. It’s looking at the future and whom we partner with in the next merger.”

Twenty years ago, Kotch had a large IT team who would try to get data out of a system using Excel. It took millions of dollars of spending, and it wasn’t working. Today, that’s completely the opposite. The company is looking at data differently through highly specialized personnel.

Kotch says updating legacies and utilizing technology for insurance comes down to thinking outside the box. For Validus, that means strategic partnerships with other companies. As a builder company, Validus seeks growth through mergers and acquisitions. She sees revenue-growth opportunity with companies such as Microsoft Edge and has to put a progressive look and feel on some of the products.

“I’ve looked at my career as having the opportunity to be a mechanic inside different companies and really being able to change the way they use technology,” Kotch says. “I’m really very proud of that.” ×