Liberating today’s insurance industry from yesterday’s legacy systems

In an age defined by technological advancement, the insurance industry continues to grapple with the complete digitization of operations that have long been reliant on legacy systems for decades.

Despite worldwide technology spending projected to increase 4.3% from 2022-2023, antiquated processes such as unsupported platforms and outdated servers have maintained a significant role in the insurance claims sector, widening the gap between carriers and policyholders with respect to customer experience, data optimization and development of internal processes.

The impact of legacy systems on today’s evolving insurance landscape is twofold. While insurance professionals face challenges in abandoning their old, tried and trusted practices due to business complexities and regulatory obstacles, their policyholders remain exposed to the potential adverse effects of processing inefficiencies and delays. Data silos, information inaccessibility and limited analytics capabilities are all examples of how insurance professionals fail to benefit from gaining valuable insight for operational improvement with new and advanced tools readily available today.

The inability to meet policyholders’ growing expectations, combined with the increasing demand for streamlined interactions, provide a stronger case for the integration of newer age digital claims solutions. This article takes a look at how insurance companies can benefit from the application of advanced insurtech tools.

Enhanced adaptability and competitiveness in changing markets

To meet growing policyholder expectations and modern technological demands, insurance companies must adopt digital solutions to remain future-ready and competitive in the evolving insurance industry. With the integration of cutting-edge insurtech tools, insurers will have the opportunity to provide comprehensive claims services while simultaneously adapting to policyholder requests and unexpected shifts within the market.

By embracing digital solutions, insurance companies will remain at the forefront of innovation, employing the necessary tools to create seamless, personalized digital experiences for all policyholders.

Data-driven approach for improved efficiency and security

Digital solutions are proven to be a transformative force within claims management. By harnessing advanced technologies such as automation, AI-driven chatbots and data dashboards, insurance companies can streamline internal processes to implement services tailored to their policyholders’ needs.

Insurance companies can further harness the opportunities presented by insurtech tools to strengthen their security measures and implement accurate risk evaluation. As a result, this will empower insurance professionals to mitigate potential data breaches, strengthening their reputation as reliable, trustworthy providers.

Reduced maintenance costs for greater budget flexibility

With the help of digital solutions, insurance professionals have the opportunity to significantly reduce maintenance costs that are typically reserved for the sustainment of legacy systems. By leveraging cloud-based infrastructures, automated communications and digital platforms, these solutions subsequently diminish the need for costly hardware upgrades, manual repairs and extensive IT assistance.

The agility of insurtech tools allows for consistent updates and scalability, resulting in substantial cost savings over time. By eliminating the expenses linked to legacy system maintenance, insurance companies are able to appropriately allocate internal resources, invest in technological innovation and develop an even greater competitive advantage in the industry.

Seamless end-user experience for employees and policyholders alike

Insurance companies can redefine the way their employees and policyholders experience claims processing for the better through the digitization of services. For employees, advanced digital solutions help simplify workflows through automated communications, self-service portals and intuitive interfaces, allowing them to prioritize high-value tasks and boost overall performance at work. In fact, 92% of employees have shared that having the right technology positively impacts their productivity and job satisfaction.

For enhanced policyholder satisfaction, insurance companies can provide a user-friendly platform that enables policyholders to seamlessly file claims, submit inquiries, and access their documents and personal information effortlessly. By optimizing the end-user experience, insurers can create a foundation that not only boosts operational efficiency, but also establishes strong policyholder relationships to set a new standard of excellence in the industry.

As the global insurtech market size is expected to reach $7.87 billion in 2023, the insurance industry finds itself at a pivotal moment where legacy systems can no longer meet modern demands.

Embracing insurtech innovations not only enhances operational efficiency but also propels insurers toward the future of claims management. With notable technological advancements such as generative AI and machine learning, the ongoing development of insurtech tools emphasizes the urgency for insurance companies to integrate digital solutions into their daily practices, allowing them to navigate the evolving landscape and redefine claims services for new and returning policyholders.

Troy Stewart is president and COO of Brush Claims. These opinions are the author’s own.

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