While many across the industry believe APIs will greatly improve business processes, many more are uncertain what an API is, much less why they would want this technology.
In this series we will be answering these questions and more.
The first question to answer is “What does ‘API’ mean?” API stands for “Application Programming Interface.” An accurate but meaningless phrase. I have read many articles defining an API and they always seem to target the developer audience.
To put ‘API’ into context, I will focus on an API everyone is familiar with: withdrawing cash at an ATM. This technology is not new. After all, ATMs entered our daily lives in the 80s. APIs have garnered new interest because they enable web and mobile applications. Without APIs our smart phones wouldn’t do much at all. But the concept itself has been around for many years.
You can go to an ATM anywhere in the world and withdraw money from your account. All ATMs offer this function but their interfaces vary. One bank may give you a list of withdrawal amounts to choose from, while another just has you key it in. Some even let you indicate what denomination of bills you want to receive.
Once your card has been read, your PIN entered and the amount you want to withdraw is selected, the API takes over. It is the API that transmits the information to your bank and waits for your bank’s response to indicate if you can or cannot have the money. It is all happening in real-time behind the scenes.
We all have confidence in the behavior of an ATM. Never do you expect the API to access someone else’s account, give you back the wrong amount of money, or your bank to claim you got a different amount. There is great confidence that it will work and work right.
When we apply this technology to the insurance industry we can think of it in similar terms. You want to use the systems you have already invested in. You don’t want to have to go to each and every company’s website to get at the information you need or to perform common functions. You want your system’s interface to gather the data it needs, use an API behind the scenes to access your trading partners’ functions real-time, and display the results. You want to be confident that regardless of what carrier you are sending the request to that it will work the same.
So what is an API?
- An API is a software-to-software interface - not a user interface
- APIs provide behind the scenes, real-time connectivity
- With APIs, applications talk to each other without user intervention
With APIs, you can use the systems you want and access the data and functions you need. That is the reason APIs are important.
Next up in this series: The Yin and Yang of APIs and Data Feeds. Stay tuned!
For more information on the API work being done by CLIEDIS, please contact Tana Sabatino, Implementation Services Specialist at CLIEDIS: email@example.com or, Darlys Corbitt, Executive Director at CLIEDIS: firstname.lastname@example.org.