How Liberty Mutual is transforming its IT using serverless computing

With a large IT infrastructure that’s still being transitioned to the cloud, global insurance giant Liberty Mutual had a conundrum. Like many other companies, it’s IT staff was kept so busy running the infrastructure that they didn’t always have the time to focus on software and process projects that could directly streamline and improve the company’s workflows.

But, that’s been changing over the last four years as Liberty Mutual began adopting serverless computing, which leaves the infrastructure management to cloud vendors, giving IT staffers much more time for creativity in building applications for the company’s employees.

The 108-year-old insurance company first started moving operations to the cloud about six years ago as part of a CIO-led cloud initiative to improve its IT processes. About 40% of Liberty Mutual’s IT operations are in public cloud today and that number continues to rise, said David Anderson, the company’s director of technology.

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As the company’s cloud roadmap unfolded, it brought new innovations and inspired development teams to look at new ways to do things, said Anderson. That led to intriguing inspirations which drew them into the growing world of serverless computing.

“We had a team that was looking at a traditional application during an innovation sprint and they spotted an opportunity to rewrite it into a serverless application,” Anderson said. “It was a traditional web application where customers log in, get advice, make insurance policy changes, and have other interactions with their insurance information. We have lots and lots of applications like that for many things.”

By rewriting it and transforming it into a serverless application, the company dramatically reduced its costs for maintaining it–from $50,000 a year to $10 per year, for a 99.98% cost savings.

“That’s quite a small example, but it’s very powerful because if you have lots of applications like that, those costs stack up very quickly,” Anderson said. “We see this as a repeated pattern. I’ve seen this at Liberty Mutual and across different industries as well.”

What is serverless computing?

When using the public cloud, companies still have to manage their cloud operations, even though their applications are running in the cloud and not in their own data centers.

“Some companies just lift and shift to the cloud, so you still have your same management overhead,” Anderson said. “For those users, there’s a reduction in run costs, but they may not get a reduction in their server management overhead.”

Serverless is different because it is managed infrastructure, handled directly by the cloud vendors instead of by the IT team. Companies can run their applications as needed, shut them down when needed, and pay only for when they are used.

What that does, Anderson said, is free up creativity, agility, and cost-savings.  

“Serverless is just a function, it runs when called and if not called, there is zero management of that function,” he said. “You sometimes call it services, so the engineering team is just constantly consuming services. There’s no configuration of infrastructure and that means a team can move fast and there’s minimal handoffs.”

The technology lets Liberty Mutual’s technology teams work in more effective ways and focus on driving the business, rather than managing thousands of complex servers. “The public cloud providers can run a server pretty well compared to an insurance company,” he said. “You’re offloading that expertise.”

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Serverless computing also adds flexibility because it allows developers to build cloud native applications more easily, including the straight-forward integration of APIs from other vendors to streamline and improve the process.

“You can do more creative things with data, such as using applied artificial intelligence (AI) services.” Anderson said. “It’s the ease of access to vendor APIs. When you’re working on a public cloud, you have to be API first. When you are working in true cloud native, you’re forced to be API first. It means a more disciplined way of engineering, but in the long term it actually increases your velocity.”

The process and learning curve of serverless computing has been eye-opening for Liberty Mutual. “It’s really the future of the cloud,” Anderson said.

Transforming document storage

In another early example of serverless computing at Liberty Mutual, engineers took a document storage application that was being used in a microservices architecture running on Amazon EC2 and saw an opportunity to move it to a serverless cloud native infrastructure. The application was moved to AWS Fargate, which is a serverless container compute engine. The change slashed its costs by 92.5% annually.

“We’ve got a bunch of compute running on these microservices,” Anderson said. “It ruins 24/7. This kind of on-demand compute and scaling is difficult to do on our own. By moving it to Fargate, it manages itself based on traffic. You can do that if you want to program it yourself, but it’s pretty complex. I’d rather AWS do that for us.”

Another application that was re-written for serverless delivery was a tool used by insurance adjusters for physical damage inspections on vehicles. The app, which is used on a mobile device such as a smartphone, was digitized and given AI functions so it can link with automaker parts applications and paint shop labor estimating applications to bring all the pieces together for faster and simpler claims processing.

“It makes it easier for the claims adjuster and reduces the cost of the inspection,” Anderson said. “What’s cool about it is that for a single nation, outside of the US, it costs $500 for a year to integrate it. You don’t need a team to sit and watch it or to patch the servers. It’s completely serverless.”

Serverless inspires an updated roadmap

At Liberty Mutual, these results using serverless computing has inspired what the company calls a serverless first strategy.
“It’s being done for the benefits,” Anderson said. “Your first implementation choice should be serverless, and if that’s not a good fit, then you walk backward.”

Of course, as with any new technology, lessons are still being learned.

“It’s been an evolution as well, because serverless is still a challenging environment to work in because you are building systems instead of applications,” Anderson said. It’s an event-driven system. We’ve got lots of different user processes. We’re thinking of the whole business problem and not just an application which is part of it.”

Yet, despite the challenges, the inspiration the technology offers to developers and development teams is addictive, he said.

“There’s a mindset in serverless teams, which is something that is quite different and quite exciting,” Anderson said. “The serverless teams behave in a quite different manner compared to other teams. Serverless allows them to focus on what they need to do and not on the infrastructure. Imagine you could take a software team and remove a lot of the baggage and let them focus purely on the business problem.”

Traditionally, software engineers think of code as an asset, so writing more code is typically seen as positive. But serverless is a whole new ballgame.

“Serverless teams see code as a liability, the more you have the more you have to manage and the more overhead you have to monitor,” Anderson said. “If you write a million lines of code, you have to make sure it’s secure, and you have to manage it. With serverless systems, you write 500 lines of code and it’s gone out the door.”

The differences are because with serverless, developers are using services instead of boilerplate code as an alternative way of creating software, Anderson said. That includes APIs from cloud vendors including AWS, Azure, and Google, as well as APIs from other partners.

“We have found that our engineers enjoy working in this domain,” Anderson said. “You might think that engineers writing less code are unhappy, but that’s not the case. This stimulates their creativity. We love writing code but we also love solving business problems.”

Serverless takeaways

For Liberty Mutual, the adoption of serverless is part of a continuing process to evolve its IT infrastructure, Anderson said. It’s an approach that all companies should embrace, he added.

“From a company perspective, make sure you have really solid cloud native principals, for security, training, your cloud billings, and more,” Anderson said. “Whatever it is, there’s a cloud native way of doing that. Instead, if you approach this in the traditional on-premises way, you’ll hold your developers back. You’ve got to think differently in the public cloud. And then you have to think even more differently with serverless.”

Companies should also invest in their engineers by encouraging cloud certifications and a constantly thriving environment of learning for IT teams, he said.

“People are often put off by serverless because it’s not a good use case or because it’s different,” Anderson said. “They say it won’t work for this, or it won’t work for that. We haven’t really found that’s the case. There are very few things that can’t be done with it.”
 

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