Liberty-Mutual-Insurance_logo@2x

Liberty Mutual Reduces Costs, Improves Time to Market by Going Serverless on AWS

2021

To achieve its goal of becoming a global digital company, major insurance provider Liberty Mutual focused on three main areas of digital transformation: customer centricity, agility, and cloud-native development. To that end, the company made a strategic business decision to pursue a serverless-first approach—a move designed to give it an edge in a competitive, global, and increasingly digital market. Liberty Mutual used Amazon Web Services (AWS) to migrate the company’s on-premises systems to the cloud to modernize and drive companywide transformation.

By using serverless architecture and letting AWS handle infrastructure management tasks like capacity provisioning and patching, Liberty Mutual reduced its operational burden and realized substantial cost savings. The company also used serverless solutions so that it could rapidly build more agile, high-quality applications. By eliminating operational overhead, serverless architecture facilitates experimentation, empowering teams to release quickly, get feedback, and iterate to get to market faster. 

“Going serverless accelerated our engineering teams,” says Dave Anderson, director of technology at Liberty Mutual. “The more we experimented with a serverless mind-set, the more we started to see a flywheel effect where we could deliver value into the hands of our business partners quickly.”

Professional man working in office.
kr_quotemark

Our collaboration to figure things out feels like more than a customer-vendor relationship. It genuinely feels like AWS is part of our team.”

Dave Anderson
Director of Technology, Liberty Mutual

Building a Future-Proof, Agile Global Business

With $40 billion in annual revenue, Liberty Mutual is the world’s sixth-largest property and casualty insurance company and is an industry frontrunner in technological innovation. The company began exploring solutions for security and test data on AWS in 2013. In 2015, Liberty Mutual began its serverless journey on AWS when James McGlennon, the company’s chief information officer, pushed for Liberty Mutual to become more agile and customer-centric in the cloud. The company previously had on-premises systems, but using those to write event-driven systems proved too complicated. 

Serverless computing, however, enabled the engineers at Liberty Mutual to build event-driven systems faster because it sped up the feedback cycle so that the systems iterated more efficiently. “The light bulb moment for me was realizing that it’s not a good day’s work for a developer to write 10,000 lines of code,” says Anderson. “We started to use the phrase ‘Code is a liability,’ reminding our engineers and architects that they shouldn’t be writing code when they don’t need to.” The engineering team shifted its focus from the nuts and bolts of building to using the building blocks of serverless architecture to quickly add business value.

Liberty Mutual chose to use AWS in its modernization journey toward serverless infrastructure because AWS offered engineering experience, a customer-centric approach, and a strong focus on security—a top priority in the highly regulated insurance industry.

Transitioning to a Serverless Infrastructure on AWS

Liberty Mutual views its transformation to serverless infrastructure as a constant journey. During the initial phase, the company built the foundational elements of its infrastructure, such as network security and deployment pipelines. In the second phase, it modernized application development and layered on serverless-first principles. Now Liberty Mutual has a serverless-first policy, so engineers must first strive to build serverless software or functions. Many serverless-first projects have already been completed, all of which use AWS Lambda, a serverless compute service that lets companies run code for any type of application or backend service with zero administration. When using the serverless-first approach isn’t feasible, the engineering team looks for a cloud-native option or—as a fallback—containerized solutions, which Liberty Mutual relies on for its legacy workloads. “These are things we’ve spent 20 years developing, so we’re not going to simply rewrite those to AWS Lambda tomorrow,” Anderson explains. “There is a huge advantage to us having those workloads containerized in the cloud, where we can build serverless infrastructure around them.” Now more than 50 percent of Liberty Mutual’s workloads run in the cloud. 

In 2019, Liberty Mutual used serverless computing to consolidate its disparate lines of business from around the globe into a centralized general ledger known as Financial Central Services (FCS)—a job too complex for an on-premises system. It wrote an extract, transform, load process that uses AWS Step Functions, a serverless function orchestrator for sequencing AWS Lambda functions and multiple AWS services into business-critical applications. Using AWS Step Functions, Liberty Mutual created an event-driven workflow in which the data feeds from each line of business are transformed into a series of events, or financial transactions, that then move into FCS. Now FCS processes 100 million transactions in one run at the end of every month, which means that for the majority of the month, it is offline and therefore not accruing costs. Processing one million transactions costs just $60. The flexibility and resiliency of the serverless architecture virtually eliminates failure.

To help deploy new applications quickly, Liberty Mutual created a software accelerator using the AWS Cloud Development Kit (AWS CDK), an open-source software development framework in which engineers can use familiar programming languages to define cloud application resources. Engineers use the programming language TypeScript to create templates, or serverless patterns, in AWS CDK. These templates can then be used to rapidly build projects rather than writing the code from scratch. The patterns also give staff a common language with which to collaborate, and new hires and engineers with little cloud experience can use the patterns to hit the ground running. About 3,500 serverless patterns were deployed from 2019 to 2020. “As a large company, you don’t want to say to developers, ‘Just search online for AWS Lambda and code something,’” says Anderson. “You need to give more support.” So the company supports its engineers in earning AWS certifications and provides training and in-house workshops. Liberty Mutual also guides engineers using AWS Well-Architected, a framework that helps cloud architects build secure, high-performing, resilient, and efficient infrastructure for their applications and workloads.

Liberty Mutual has used serverless architecture to build several systems in just 3 months, compared to the 1 year it would take on premises. In one case, a team of four developers used serverless patterns in AWS CDK to build an equine and livestock insurance sales and administration application in 12 weeks—3 months ahead of schedule. The team used the extra time to create visual dashboards that added value to the application. “We can spend more time using the AWS Well-Architected Review to make a product extremely high quality,” says Anderson.

Continuing to Grow the Serverless-First Approach

Liberty Mutual plans to implement Amazon EventBridge, a serverless event bus that makes it easy to connect applications using data from one’s own applications, integrated software-as-a-service applications, and AWS services. Amazon EventBridge will enable the company to offload the complexity of building its own eventing backbone.

By using serverless architecture on AWS, Liberty Mutual has become more agile, releasing higher-quality solutions for customers on a faster time line while reducing costs and removing the responsibility of infrastructure maintenance from staff. Internal surveys of Liberty Mutual’s engineering teams have revealed that staff are happier and have fewer frustrations. “Their engagement lifted,” Anderson observes. “They feel more productive because they’ve got a better set of tools at hand.” 

Support from AWS has enabled Liberty Mutual to keep expanding and reaping the benefits of its serverless-first approach. “Our collaboration to figure things out feels like more than a customer-vendor relationship,” Anderson says. “It genuinely feels like AWS is part of our team.”

Liberty Mutual Reference Architecture

LMI_Architecturediagram_serverless-case-study

About Liberty Mutual

Founded in 1912, Liberty Mutual is an American diversified global insurer and the sixth-largest property and casualty insurer globally. It ranks 77th on the Fortune 100 list of largest corporations in the United States, based on 2019 revenue.

Benefits of AWS

  • Processes 100 million transactions per month in its FCS system
  • Reduced computing costs per million transactions to $60
  • Deployed over 3,500 serverless patterns in 1 year using AWS CDK
  • Decreased application build time to 3 months from 1 year
  • Increased to running 50% of its workloads on AWS in 2020
  • Reduced onboarding time for engineers 
  • Removed burden of infrastructure maintenance from staff
  • Boosted system flexibility and resilience

AWS Services Used

AWS Lambda

AWS Lambda is a serverless compute service that lets you run code without provisioning or managing servers, creating workload-aware cluster scaling logic, maintaining event integrations, or managing runtimes.

Learn more »

AWS Step Functions

AWS Step Functions is a serverless function orchestrator that makes it easy to sequence AWS Lambda functions and multiple AWS services into business-critical applications. 

Learn more »

AWS CDK

The AWS Cloud Development Kit (AWS CDK) is an open source software development framework to define your cloud application resources using familiar programming languages.

Learn more »

AWS Well-Architected

AWS Well-Architected helps cloud architects build secure, high-performing, resilient, and efficient infrastructure for their applications and workloads. 

Learn more »


Get Started

Companies of all sizes across all industries are transforming their businesses every day using AWS. Contact our experts and start your own AWS Cloud journey today.