nib completes ambitious migration to cloud

• nib Group moves to the cloud; closes last of seven data centres
• migration provides flexible, expansive environment; nib can dial up and down as needed
• move to cloud underpins ongoing innovation, use of AI, and data analytics

nib holdings (ASX: NHF) said today it has delivered on its cloud-first strategy, deepening its collaboration with Amazon Web Services (AWS) by migrating more than 95% of its on-premise workloads across all business lines into AWS.

nib, which is a top-100 ASX-listed company, completed the migration in February. It closed the last of its seven data centres, five in Australia and two New Zealand, in March 2024.

nib had group revenue of $3.1 billion in the year to June 30, 2023. In its latest reporting period, the six months to 31 December 2023, nib paid $1.2 billion in private health insurance claims for 224,670 hospital visits, and 2 million visits to ancillary health providers. It is Australia’s third largest provider of travel insurance; a leading provider of health insurance for international students and workers in Australia; and has a foundational interest in Australia’s National Disability Insurance Scheme (NDIS), helping almost 40,000 participants through its nib Thrive business.

“AWS allows nib to expand its current use and future exploration of artificial intelligence (AI) and the ways that AI might drive nib’s consumer-facing businesses as they grow to support Australians managing their everyday health,” said nib Group Chief Information Officer, Brendan Mills.

“The move is very much a strategic decision on many fronts. We are confident about the environment; AWS provides us with agility and flexibility, it allows nib to build capability in the way we operate our business and contain costs.”

Mr Mills said cloud-based computing provides nib with an expansive environment; one that can be dialled-up or down on a needs-basis, is cost efficient and allows better member data analytics.

nib significantly increased its use of cloud services in 2019, with the migration of its corporate health insurance business GU Health to AWS. It was one of the earliest migrations of an insurance system of record to the cloud in Australia. In 2019, nib worked closely with the regulator, the Australian Prudential Regulation Authority (APRA), and has again worked to meet APRA’s Cloud Adoption Standards and Techniques (CAST) requirements. APRA defines a system of record as one that maintains information essential for an institution to determine its obligations to customers and counterparties.
nib has moved multiple Extreme Inherent Risk (EIR) systems in the final stages of the migration, which aligns with industry best practice.

“By transferring these EIR systems, we've further fortified our technology backbone, ensuring that critical operations are running on advanced and resilient platforms,” Mr Mills said.

Post-migration, nib now manages thousands of workloads in AWS. Workloads are dynamically transformed using micro-services and serverless computing. This approach leverages the benefits of cloud-native services to optimise performance, scalability, and resilience.nib has strategically developed and enriched its digital assets alongside its migration to the cloud. Central to this evolution is "nibby," nib’s AI-powered voice and text chatbot, developed using Amazon Services such as Amazon SageMaker, a service that builds, trains, and deploys machine learning (ML) models, and Amazon Lex, a fully managed AI service for building conversational interfaces. Since its introduction, nibby has adeptly managed more than 3.2 million customer queries as of January 2024.

Rianne Van Veldhuizen, managing director Australia and New Zealand at Amazon Web Services, said the healthcare insurance industry is going through a swift period of modernisation to help improve the experience and health outcomes for members, who demand proactive, predictive, and personalised healthcare coverage.

“nib has been at the forefront of leveraging the depth and breadth of our services since 2017, especially in the use of AI and machine learning,” Ms Van Veldhuizen said.

“Migrating 95% of its workloads to AWS has allowed nib to remain resilient and agile, extract key business insights, develop personalised member experiences, and improve the cost and operational efficiency for members.”