Building an Insurance Technology Ecosystem for 2019 and Beyond
Digital is happening. Insurers are keenly aware that they need rapid development cycles, and that they also must remain flexible and nimble. With digitalization high on the agenda, operations and IT have moved to the forefront of the business. Historically, insurers focused primarily on the underwriting and actuarial aspects of the business, but IT and Operations are now coming to the forefront. They are not only focused on ways to reduce costs and optimize processes, but on improving customer service, creating optimal customer experiences and maximizing internal effectiveness. But now the systems landscape has to follow suit.
This is a real challenge for CIO and COO’s in the insurance industry. Over the years, the high level of merger and acquisition activity has resulted in a challenging technology landscape that can often be a moving target of siloed core systems, point systems, and databases. How can insurers effectively manage the complicated technology landscape they have – and prepare for new and emerging technologies? And of critical importance – where do InsurTech technologies come in and what challenges and benefits do they really bring? Answering these questions is key for insurance companies as they determine their IT and operational roadmaps.
Is Enterprise Low-Code the Answer to Digital Transformation?
In this setting, the focus for insurers must include a way for them to slot new technologies into a comprehensive technology ecosystem – which includes their existing systems and databases – rather than going down the path of an expensive, lengthy rip and replace project. Ultimately, an enterprise low-code platform enables insurers to easily integrate old and new technologies with agility, speed, and optimal TCO.
Companies should have a proactive and positive approach when it comes to digital transformation. Frankly, the need to respond to the pressure of customer demands and InsurTech developments is what is moving the insurance industry forward, and there is room for more innovation in the market – and not just from new players in the industry. As established insurers look to retain current customers and grow market share, many are funding technology incubators and their own InsurTech start-ups.
New Technologies for Insurers
New technologies bring a solution to the common challenges. Things like Robotic Process Automation (RPA), Artificial Intelligence (AI) and telematics can positively impact the business.
RPA for instance, can replace tedious parts of processing. For example, getting an address out of the old mainframe – a system that is too complex and stable to remove or replace. Using RPA in this way makes the job of an agent or customer service representative much easier, enabling them to spend more time communicating with the customer, as opposed to looking for the answer to a question. AI can be used to support decision-making for an underwriter or claims adjuster for things like analyzing fraud or confirming coverages, increasing speed and accuracy to improve service levels.
But – there is a tech-elephant in the room. How will these technologies progress? Will companies like Amazon, Google, or another giant, disrupt the market with new propositions based on their possession of enormous amounts of data and vast network of technology? We simply don’t know yet. What we do know, however, is that waiting for the next big thing is not the answer.
Building a technology ecosystem that will take your company into the future is top of mind as we head into 2019. Be sure to catch my blog post next week, where we’ll explore the 5 things you need to consider when evaluating new technology.
Industry Lead Insurance