INSURERS AT RISK OF DISCONNECT FROM CUSTOMERS AND TEAMS IF MEDIOCRE IT SYSTEMS PERSIST, SAYS INSTANDA
INSTANDA, the leading customer and policy management platform for the insurance industry, has revealed the findings of The Insurance Disconnect report, a deep dive into the sentiment of senior insurance leaders in the UK toward the capabilities of their existing IT systems.
The report surveyed 500 UK-based senior Insurance and Reinsurance leaders in IT, Marketing, Strategy, Distribution, and Product Innovation on the ability of their systems to understand how capable they are in meeting their intended purpose, their legacy investment intentions, and how the pandemic has impacted digital transformation.
Against specified product and business objectives, the survey results revealed a muted confidence in the capability of their existing IT systems. Nearly half of those surveyed reported that their systems were only ‘quite able’ to meet the needs of today’s customers.
The survey also uncovered a disconnect among the views of front-facing respondents in Product and Marketing teams with 51% claiming to feel frustrated by the outdated legacy systems. 52% were of the view that they are missing out on business growth opportunities because of their existing IT systems.
Capco’s Matt Hutchins says that “insurers need to raise the bar. The US represents the largest global insurance market...mediocrity will not be a winning strategy for incumbents.”
Additionally, a separate disconnect was unveiled by the report regarding the sentiment across IT teams and Product/Marketing teams, with IT teams strikingly more confident in their current system capability than their front-facing product innovation teams.* Based on those reporting that their current systems are ‘extremely able’ of delivering desired business outcomes, IT teams remained consistently more optimistic than their business-facing counterparts.
Yet, Softelligence’s Daniel Jinga believes that the gap between IT and front-facing teams is closing, but there is still a “need to rethink the split between product innovation and hard technology skills, and how this is communicated to internal audiences and business stakeholders.”
When asked about the impact Covid-19 has had on digital transformation initiatives and the shift in sentiment toward existing IT systems, 70% of business-facing respondents agreed that they would be accelerated as a result of the pandemic, with 68% claiming to be now more likely to move part or all their business over to the Cloud because of the pandemic.
CEO and Founder of INSTANDA, Tim Hardcastle, commented: “There’s an encouraging acceptance of the need for digitalization in insurance post pandemic, but we are still seeing evidence of a strong undercurrent holding innovation back.
“This overriding acceptance of mediocrity is particularly concerning, and a significant mindset shift is needed. Insurers must accelerate their pivot towards digitizing their product development, distribution and operational strategies to meet rapidly changing customer needs, otherwise they are at risk of a complete disconnection from their customers and teams. And it is imperative that this acceleration happens at a business-wide level rather than just within IT teams.”
Deloitte’s InsurTech Technology Transformation Partner, Nigel Walsh, added: “There’s an acknowledgment that businesses need to move faster and address speed to market now. To do this, there must be a change in mindset with a capability set to match what is far more open, flexible and agile.”
This shift in mindset will need to include those who not only compete with challenger insurers in the application of digital and data, they do it better. Only then will they find new business growth opportunities in this new normal that the World is in.
Interested in learning more on how to bring teams and customers closer together in 2021? Download the full report here.