Dear friend,
The insurance industry faces challenges and opportunities, with legacy application modernization being the focus for CIOs in 2023.
According to the 2022 Gartner CIO and Technology Executive Survey, 57% of insurance companies report their plans to increase investments in legacy application modernization compared to 2021. This trend is driven by the need to stay competitive in today's digital landscape and the realization that outdated systems might stifle innovation and growth.
To insurers, ageing legacy technology means costly maintenance and poses a major obstacle to change. The ISG Survey State of the European Insurance Industry 2022 found that 67% of insurers highlighted the urgency of replacing their legacy systems if they want to be future-ready.
However, as long as legacy system modernization will be viewed as primarily a pure replacement project - a way to replace the existing features with exactly the same, just newer features - the risks of using outdated technologies will come at a much higher cost and have negative long-term effects. These include the lack of agility, poor innovation capabilities, the slow and costly rollout of new products, rising infrastructure, and customer acquisition costs, and growing operational risk, to name just a few.
The solution? Look for value in the features and capabilities of modern digital insurance platforms that amplify the effect of your digital transformation efforts. Look beyond the core.
1. Consider business objectives and outcomes.
Insurers should approach legacy replacement as a business transformation project. The focus should be on the cost of ownership, productivity gains, tech consolidation, regulatory compliance, innovation, improved service, and faster time-to-market.
A modern platform like AdInsure can help meet these goals: one of our clients used AdInsure to digitize the claims and policy management processes, and they improved average claim settlement productivity by 112%.
2. Go for rich features for your business and IT teams.
Once you consider your current resources and options, you can concentrate on what your team needs and align new features with business strategy.
If one of the main objectives of your business strategy is to improve customer experience (and reap the long-term benefits of happy clients), look at solutions like AdInsure, which supports multichannel operations and can be easily integrated with portals, mobile applications, and chatbots. At the same time, it can provide a 360-degree view of your clients and provide supplementary CRM features.
3. Consider modern architectures that power future-proof capabilities.
Look for digital platforms with API-first design, automation, low-code support, core features, configurable/reusable product development, multi-channel support for easy migration of users, and cloud support, as cloud deployments allow you to update and upgrade the solution easily while providing you with the flexibility of anywhere and anytime access.
As technology continues to evolve, insurance companies must keep up with the times to secure business growth and remain competitive. Partnering with the right technology partner can make this process easier for you.
To help guide you along your modernization journey, we've put together a white paper providing in-depth information on the challenges and steps involved in modernizing your core system. Download a copy now to learn more.