A discussion of the seven core strategies that insurance companies can use to modernize their IT efforts.
When it comes to information technology, the legacy systems of yesterday are very rarely capable of handling the unique challenges of today – to say nothing of the difficulties posed by the possibilities of tomorrow. This is especially true for insurance companies, where core system transformation is expected to remain a top priority across the board for the next several years.
Modernizing insurance company information is time consuming, costly and risky – but it is not impossible. For insurance companies to truly build and implement the solutions they need, they must keep a few important strategies in mind.
Build With a Purpose in Mind
Perhaps the number one way to modernize insurance company information technology is to build not necessarily with the challenges of today in mind, but with the end results needed for tomorrow. Insurance companies need to have systems in place that don’t just keep things like investment budget or time to market in mind, but also with future plans, strategic priorities and more. It’s a balance to be sure, but it’s an important balance to strike.
It’s About the Entire Organization
If insurance companies really want to modernize their information technology, they need to have the backing of the entire company – not just the IT department. Not only all departments, but also vendors, need to provide their input to build a system that EVERYONE sees value in and that will benefit EVERYONE moving forward. If IT decisions are made in an IT silo, it will be much harder to get everyone on board.
Focus on Change Management
In the insurance company, needs change on a regular basis. Customer preferences are fluid, regulatory norms one day are gone the next. To truly modernize insurance company IT, change management must become a priority. Business sponsors, program management officials, experts, vendors and more should all be able to regularly monitor deployment until the end of the program for the absolute best results moving forward.
Picking the Right Partners is Critical
As stated, modernizing insurance company IT is something that CANNOT be done with only the IT department. Partners are needed, but those partners must be vetted very carefully to help make sure they have the relevant experience in a project of this scope and magnitude. Partners must be able to handle the heavy level of customization that is going to be needed, must have credibility, must be able to help support changes that themselves support key business requirements and more.
Understand That Risk Never Goes Away
When it comes to executing an insurance company IT infrastructure update, one of the most important keys to success involves the understanding that risk is always a present. When it comes to something as fickle as IT, things going wrong is not a question of “if” but “when.” Project leaders need to have risk assessment plans so that they not only know what they’re up against, but so that mitigation plans can be developed in the most effective way possible.
Pay Close Attention to Data Migration
When it comes to modernizing insurance company information technology, there are two key factors to concern yourself with. The first is the new system requirements, processes and other infrastructure changes that will be required. The second (and equally important) is the critical data that will need to be converted and migrated from the old system to the new without issue.
Insurance companies will need to build an approach for how to handle active policies, claims, transactions, data quality and more before, during and after this process.
Service Oriented Architecture
Modern insurance company IT demands a certain level of flexibility and versatility that can only be provided by SOA support, or Service Oriented Architecture. When it comes time to integrating between peripherals and external systems, having a separate team on-hand to oversee this very important (and time consuming) process is always advised. This is a team that won’t have to split their attention in countless directions and can instead focus on the important task at hand.
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