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Is the Insurance Industry Finally Embracing a Data-Driven, Customer-Focused Future?

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Fintech Alliance – by EPAM Systems, Inc.

Is the Insurance Industry Finally Embracing a Data-Driven, Customer-Focused Future?

The insurance sector has been relatively slow to adopt the digital, data-centric future, but it's steadily becoming a primary focus due to improved effectiveness and enhanced customer education understanding. 

The report, Digital Modernization in the Insurance Industry: How to Drive Progress in Your Organization, produced by EPAM Systems and backed by London Research, reveals a key finding: insurance companies acknowledge the necessity of change. Less than half of the companies surveyed categorize themselves as 'advanced' in the main areas of business evolution. Only slightly more consider their progress ‘significant.'

Business transformation has been an uninviting prospect in the insurance industry for some time. One respondent explained, “When the business model is operational, convincing stakeholders you need to modify something can be taxing. They argue that we already generate gigantic profits, so why do we need to change our operations?”

Yet, various coexisting trends are now shaking up the sector, common across all verticals, including some relating explicitly to insurance. Here are a few catalysts of change:

The Ghost of Outdated Technology

Legacy technology infrastructure is the most significant obstacle for insurance companies aspiring to harness digital tools and adopt unique operational methods. In fact, it's a major barrier for 45% of surveyed companies. It inhibits innovation, compromises client experience and slows down speed-to-market. Legacy technology burdens IT teams with maintaining and upgrading it, while makeshift solutions implemented by disgruntled employees are setting up future problems for the IT department.

There are other factors amplifying this outdated tech issue: a lack of digital leadership (identified as a significant issue by 38%), misalignment between business and IT (38%), absence of a business case for change (35%), lack of funding (34%) and insufficient executive backing (32%).

Read the full article here.

Read the research report Digital Modernization in the Insurance Industry: