Introduction: Why Business Rules Matter in Modern Systems
Speed, flexibility, and accuracy are non-negotiable. Whether you’re in insurance, banking, or e-commerce, your ability to respond to market changes often depends on how effectively your systems manage business rules.
Business rules provide the foundation for automating business decisions and processes by formalizing logic through conditions and actions, streamlining operations, enforcing policies, and facilitating decision-making without requiring coding.
Modern businesses increasingly rely on rules engines to externalize and manage logic such as pricing, eligibility, risk assessments, and product availability. These engines allow decision logic to be updated independently of core application code - a capability known as business logic configuration.
This article walks through 10 real-world examples of business rules, showcasing how platforms like Higson enable dynamic, testable, and version-controlled configurations across industries.
What Is a Business Rule?
A business rule is a statement that defines or constrains a process or operation. It expresses conditional logic in the form:
| When X is true, then Y must happen.
There are several aspects of business rules to consider, including rule definition, management, and integration with business processes.
Unlike traditional logic buried in software code, business rules are now often configured using decision tables, flows, or scripted functions that can be managed by non-technical users.
Defining Business Logic Configuration
Business logic configuration refers to the practice of isolating decision-making rules from the application layer, making them configurable through user interfaces and logic engines.
Difference Between Rules and Code-Based Logic
Traditional applications require developers to change source code for every logic adjustment. With a rules engine, you define and modify rules through external tables or flows, and rules can also be written in various scripting or programming languages depending on the engine, enabling faster iteration, lower IT dependency, and easier compliance tracking.
Understanding a Rules Engine
What Is a Rules Engine?
A rules engine is a software tool that separates business logic from system code. It evaluates rules in real time, based on input data, and outputs decisions like prices, validations, or classifications. Rules engines execute rules by running or invoking them as part of the decision-making process.
Benefits of Using Rules Engines in Business Applications
- Faster product updates
- Real-time decision-making
- Business-user empowerment
- Versioning and rollback
- Greater transparency and auditability
- Efficient execution of rules, ensuring swift and accurate rule processing in business applications
How Higson Enables Business Logic Configuration
Higson is a rules engine and BRMS (Business Rules Management System) that empowers teams to centralize, test, and deploy complex rules without touching application code.
In addition to these capabilities, Higson supports other functions such as defining, verifying, and executing rules, which are essential for decision-making processes and operational logic.
No-Code vs Low-Code Rule Configuration
In Higson, many rules can be configured using no-code decision tables. For more complex scenarios, teams can write reusable functions using JavaScript or Groovy—maintaining clarity and control.
Integration with Core Systems
Higson integrates via APIs with microservices and traditional systems, executing business rules for pricing, eligibility, underwriting, and more—often in under one millisecond.
Higson also supports the deployment and management of rule changes in production environments, ensuring effective rule execution in live systems.
Examples of Business Rules
1. Insurance Tariff Rules
One of the most common examples of business rules managed through a rules engine like Higson is insurance tariff logic. Imagine a product manager needing to adjust premiums based on age bands and product codes. Instead of coding each condition manually, they configure the following logic via a decision table, allowing the rules engine to determine the appropriate tariff factor based on the product and customer data:
- If the product is “PRD_A” and the customer is under 30, apply a tariff factor of 0.95.
- For the same product and customers aged 31 to 60, apply 1.10.
- If the customer is over 60, set the factor to 1.30.
- If the product is “WB_2”, always use a factor of 1.50 regardless of age.
- For any other product, apply a default factor of 1.80.
This entire business logic configuration can be managed directly in Higson’s interface- no deployments, no developer involvement.
2. Customer segmentation
Customers are assigned to pricing segments based on age, claim history, or loyalty status. The rules engine performs tasks such as evaluating customer data, checking it against predefined criteria, and assigning each customer to the appropriate segment. These segments affect the premiums offered.
3. Validation check
For example, a rule stating, “driver must be at least 18 years old” or “total insured value must not exceed 1 million USD” ensures clean, validated input. Business rules can also validate other types of data columns or fields, depending on the application's requirements.
4. Premium modulation
ricing can change depending on vehicle type, geography, or past incidents. A sedan in a low-risk zone might get a 10% discount, while a sports car in a high-risk region sees a 20% surcharge.
5. Product availability
Certain insurance options may be blocked for users in specific regions or may only appear during specific time windows (e.g., campaign logic).
6. Claims automation
Rules can automatically approve or flag claims based on declared loss type, policy status, and previous claims record.
Watch also our webinar about claims automation with AI.
7. Underwriting Decision Logic
Approve, reject, or refer applications based on combined risk scores, questionnaire responses, and policy-specific rules.
These examples demonstrate how a rules engine replaces rigid application code with dynamic, editable conditions.
Bringing It All Together: The Power of Configurable Logic
The beauty of managing business rules through a dedicated rules engine lies in the combination of control, speed, and transparency. Business rules engines support different types of rule processing, such as production, reactive, or backward-chaining engines. Business logic configuration is no longer just a technical task - it’s a strategic capability. Business rules can be applied to most data column types, but some other types, like composite columns, may have limitations depending on the application interface. Whether it’s configuring eligibility filters, dynamic pricing models, or claim assessment flows, platforms like Higson allow both technical and non-technical users to adjust decision logic in real time. This makes organizations more responsive, more compliant, and ultimately more competitive in fast-changing markets.
Conclusion
Business rules are the engine behind decision-making in modern insurance and finance platforms. Whether calculating premiums, validating data, or segmenting customers, these rules need to be agile and transparent. A powerful rules engine like Higson turns logic into an asset that is configurable, testable, and aligned with how businesses actually work.
Take Full Control of Your Product Logic
We provide fee Proof Of Concept, so you can see how Higson can work with your individual business logic.
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