The P&C insurance industry has crossed a threshold.

The majority of insurance core systems sold since 2015 were cloud-based or hosted rather than implemented on premises, according to research from Strategy Meets Action, a strategic advisory services firm serving the insurance industry. This has critical implications for insurers who have taken a wait-and-see approach to digital transformation, chiefly: The gap between insurers that are digitally enabled from the core and those that are not is accelerating. It's no longer a question of whether to replace core legacy systems. It's a question of how.

Many insurers — and especially small-to-medium carriers and those with smaller pools of tech talent to draw from — are effectively leapfrogging the competition by transitioning to a Software as a Service model for their core systems.

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