As I discussed in a recent blog series on industry growth, optimizing operating platforms is one of the main hurdles North American life insurers face as they pursue high-potential growth segments.
Outdated technology limits insurers’ ability to deliver the products and services that customers want—everything from more relevant offers, to self-service via preferred channels that digital-ready competitors are all too eager to make available.
Yet, many life insurers struggle to:
- Justify the cost. How aligned is the target IT system to the business strategy? What’s the business case, and resulting capital requirement? Based on Accenture’s experience, a modern platform introduces back-office and process efficiencies that typically reduce IT operating costs by 20 to 30 percent, development costs by 20 percent, application and infrastructure costs by 25 percent and service costs per policy by 30 percent.
- Determine the best migration path. What are critical journey steps? What new skills, processes, capabilities and enabling technology are needed? What strategies will mitigate risk and re-work? What role might outsourcing play? Regardless of the approach, whether a legacy wrap, renovation, replacement or some combination thereof, insurers must have a clear view of the journey implications and a well-defined, realistic roadmap.
- Ready the business. What change management tactics will prepare the organization to engage and sustain the changes to achieve intended benefit?
To discover how Accenture is helping life insurers surmount these platform modernization hurdles, read The Digital Insurer: Reducing Costs and Time to Market through Life Platform Modernization.