Majority of insurance organisations are considering upgrading their tech

Majority of insurance organisations are considering upgrading their tech | Insurance Business Australia

Travel

Majority of insurance organisations are considering upgrading their tech

Insurers gear up to embrace new insurance management platforms

An in-depth analysis conducted by Novidea, a provider of cloud-based, data-driven insurance management platforms, found 75% of insurance organisations worldwide are gearing up to embrace new core insurance management platforms within the next two years.

This revelation comes from the findings of a comprehensive report titled “Legacy Out, Digitalization In: The State of Modern Insurance Technologies 2024.” The report is the result of a survey conducted in 2023, involving 330 full-time C-level leaders in the insurance industry across eight countries. The survey looked into the struggles of insurance organisations with aging, disparate technology, leaving leaders with the difficulty to manage, scale, and leverage to keep up with the modern digital transformation.

On average, an organisation manages six different insurance technology systems, while the average age of these systems has been found to be at least five years. As a result, leaders have had to invest in the training of their employees to extract the most value from their technology systems, and the challenge is greater with staff working remotely.

“The data shows that insurance leaders are ready to make future-forward decisions about the technological shift required to better meet customers’ expectations of a modern, digital-first experience,” said Roi Agababa, CEO of Novidea. “As the survey shows, there is a clear acknowledgment that current systems are aging, disconnected, and do not support today’s digital demands.”

Key findings of the report

Agababa noted leaders also exhibit optimism with regards to their legacy tech, considering making upgrades. He sees this to be encouraging as the industry heads into the new year.

The report’s key data points provide valuable insights into the technological challenges faced by insurance entities:

A staggering 76% of enterprise insurance organisations with over 5,000 employees manage between 6 and 10 insurance technologies or more
Approximately 40% of insurance agency/broker management platforms and policy administration systems have been in use for 5 to 15 years
Notably, 99% of global insurance organisations have plans to overhaul their core technology systems, with 41% intending to initiate this upgrade within the next 12 months, and an additional 34% planning changes by 2025
In the intricate regulatory landscape of the US insurance market, less than 25% of enterprise insurance organisations express confidence in their existing technology’s compliance support, and a substantial 77% find it helpful only “some of the time”

When questioned about their primary challenges with current technology systems, insurance leaders pinpointed issues such as data quality (41%), data privacy and security (35%), and scalability (35%). Notably, CEOs expressed heightened concern about scalability, with 50% identifying it as a top challenge compared to 33% for the rest of the C-suite.

Have any thoughts about these new findings? Leave a comment below.