Adopting new technology creates a lot of anxiety for insurance organizations. Cost concerns and the potential risks around service interruption often keep them in a holding pattern where they remain dependent on outmoded systems that lack the features and scalability they need to move forward. However, many insurance leaders have reached an inflection point.
Think about how quickly your customers’ digital experience expectations have skyrocketed in the last five years. The pandemic and “work from anywhere” lifestyle have forced many insurance organizations to take an unflinching look at all of their technology investments. The question becomes: Are these investments helping your business to grow and scale?
Recently, we surveyed hundreds of insurance CEOs, CTOs, CIOs, CFOs and COOs about the current state of insurance technology. We learned that, too often, their technology systems are not helping them meet their growth goals or delivering high-quality data to help them make decisions. We also learned that they are fully aware of the shortcomings of their current technology systems and are planning to make significant changes.
Consider this: 76% of insurance organizations with over 5,000 employees juggle an average of six to 10 technology systems. More often than not, these are legacy systems with an average duration of use of four years. When it comes to insurance-specific agency and broker management platforms and policy administration systems, 41% of respondents admit to keeping the same system for five to 15 years. In short, their current investments are aging out.
As these insurance leaders go through their due diligence and issue RFPs in search of new, purpose-built software platforms, there are a few key things to remember.
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The seven most important attributes of an insurance management platform are:
1. Scalability: Growth is the name of the game, and the right software platform should be able to manage an insurance organization’s growth at scale. That means the power to accommodate a growing number of users, agents, partners and policy transactions and increasing amounts of customer data without significant reengineering efforts. Further, the software platform of choice must have the ability to understand and streamline insurance workflows across the organization. Scalability also means being able to incorporate acquisitions, including the addition of a different operating model than the acquirer.
2. Configuration and Flexibility: The insurance industry is too complex and varied for a one-size-fits-all approach to software platforms. This is where the platform-based approach can bring tremendous value, with configurable features and modules that can meet a specific insurance business need. This flexibility enables businesses to create unique solutions without starting from scratch.
3. Interoperability and Ecosystem Building: With the growing popularity of insurance ecosystems, software platforms must be built for today’s technology partnerships. For example, platforms with open API architecture have the power to support integration with other software systems and services, enabling seamless data exchange and interoperability. This interoperability reduces data silos and enhances collaboration within and between organizations.
4. Cost-effectiveness: Leveraging a software platform can be more cost-effective than developing a custom solution from scratch or combining multiple point solutions that aren’t built for the insurance sector. It’s also less risky given the likelihood of failures of in-house software builds. Platforms often offer subscription-based pricing models or pay-as-you-go options, reducing upfront costs and providing predictable expenses.
5. Support for “Work from Anywhere:” Cloud-based insurance management platforms are accessible from anywhere with an internet connection. This accessibility expands the reach of applications and services, catering to a broader audience and enhancing user engagement. It also helps to support remote work for agents and brokers.
6. Data Insights and Real-Time Analytics: This is probably the most vital feature of an insurance software platform, solving a major challenge for insurance organizations. Our research shows that data quality issues are the number-one concern (41%) of insurance leaders regarding their current technology. The built-in analytics and reporting capabilities of platforms provide valuable insights into user behavior, trends and performance metrics. These insights empower businesses to make data-driven decisions and optimize their operations.
7. Security and Compliance: Many platforms invest heavily in security measures and compliance certifications, such as GDPR or SOC 2, to ensure data protection and meet regulatory requirements. This commitment to security and compliance instills trust and confidence among users and stakeholders. Compliance with regulatory requirements is another critical aspect of the insurance industry. Software platforms can help ensure compliance by incorporating features such as automated reporting, audit trails and adherence to industry standards and regulations.
See also: 5 Must-Haves in Agency Management Systems
Overall, software platforms offer a range of benefits that align with the evolving needs of insurance businesses in today's digital landscape. Some software platforms allow insurance companies to automate certain processes, from underwriting and policy management to claims processing and customer service. This automation reduces manual effort, eliminates the need to re-key information, speeds up processes and minimizes errors. All of this leads to improved operational efficiency and a better customer experience.
For example, Atlantic Global Risk, a forward-thinking specialty insurance broker that specializes in crafting complex insurance solutions for legal, tax and credit risks, recently invested in a software platform that replaced three separate technology tools. Before making this technology upgrade, Atlantic Global Risk was juggling multiple applications for different operational needs, including a CRM for sales leads, an enterprise cloud platform for managing associates, policies and documentation and an agency management application for invoices and customer records. The challenge was that these applications were not specifically designed for the insurance industry, leading to inefficiencies and data fragmentation across departments. The company was able to streamline workflows, eliminate data silos caused by having so many different applications that could not talk to each other and empower its staff with access to a single source of information across the company.
With industry-specific software platforms, insurance companies can offer digital self-service options to their customers, such as online policy purchasing, claims submission and account management through a customer portal. This improves the overall customer experience by providing convenience and accessibility.
Insurance organizations are turning to software platforms to stay competitive in a rapidly evolving industry, improve operational efficiency, empower their employees, enhance customer experience and drive innovation.
