Innovation is the key to survival in today's competitive insurance industry landscape. As the market grows increasingly competitive and regulations tighten, insurers globally are re-evaluating their strategies to identify new avenues for growth while sustaining current business.
Insurers are assessing how best to leverage emerging technology innovations to address these top five priorities:
Growing the business
- Improving customer experience
- Containing costs
- Improving risk management
- Meeting regulatory compliance
However, dated legacy systems typically make innovation – a necessity for insurers today – extremely difficult. These legacy systems are proving to be cumbersome and costly to maintain, and inflexible in meeting new and emerging business needs. To achieve these five business priorities, insurers need to not only transform their IT systems but also need to modernize their legacy systems.
While insurers recognize the need to modernize their systems, considering the number of assets involved, they fear that the transformation could prove expensive, difficult, complex, and risky – possibly resulting in disruption of business.
Based on our experience working with large insurers on their modernization programs, here are the seven "must do's" we recommend for the successful execution of modernization initiatives:
The seven “must do's” outlined in this paper are field-tested proven success criteria that we recommend insurers adopt in defining and executing their modernization programs. It will enable insurers achieve their top five business priorities driving modernization initiatives and lay the foundation for the shift to their future digital ecosystem.
- Ensure incremental business value delivery
- Simplify business processes
- Extract business rules from legacy systems & decide what needs to be carried forward
- Enable seamless integration of systems enabling real-time or near real-time processing
- Define clear strategy for data
- Plan for early performance testing
- Sunset legacy