Insurers understand the need to innovate by moving to the cloud in order to innovate and grow. At the same time, they are looking closely at their heritage blocks to determine the business value of converting them. Doing so opens up opportunities to eliminate legacy systems and reduce their technical debt. Some carriers are using their company’s business strategies, while others are taking an approach that helps them improve product efficiency. Others are going even further and using their DevOps team to manage and manage their process management systems (PAS). A common thread among these carriers is a shift to the cloud, which has helped them unlock value by strengthening their digital cores and capabilities.
A replatform for flexibility, innovation and growth
For example, one insurance leader used his company’s business migration to reengineer his policy management system (PAS) and move it to the company’s AWS cloud. The move provided flexibility as the company looked to meet the needs of its customers through the creation of new products and services. In less than a year, the carrier integrated years of product technology — the “secret sauce” of insurance — from its four platforms into the new PAS in the cloud. In addition to reducing their technology debt, they are now able to design, test and introduce new products at a better scale – a competitive advantage in meeting the rapidly changing needs of consumers.
The flexibility of the cloud enables business transformation
But what about changing business needs? With many insurers serving multiple businesses, each with different needs, the flexibility of the cloud helps them manage operational costs and leverage talent. Take a Tier 2 carrier, for example. They have their own AWS infrastructure along with a business team of DevOps people ensuring that the right technologies are in place in all operating environments and that they are being used effectively. In addition, the team that manages the core PAS has its own DevOps team that manages the actual PAS operations and supporting platforms such as .net and OpenShift, along with the advanced WebSphere JBoss. In short, they plug any platform they choose into their PAS. And their PAS uses a containerized architecture, which enables them to take advantage of the platform-as-a-service to scale efficiently and effectively.
Cloud for business agility and competitive advantage
Cost is not a factor insurers are considering in their move to the cloud. According to Aite-Novarica’s report, insurers pay little attention to reducing costs in their cloud solutions. Instead, they are looking for business agility and new capabilities that the cloud offers. These factors can provide a significant competitive advantage, especially if a strong digital infrastructure, powered by the cloud, is combined with data and AI, as evidenced by our recent Total Enterprise Reinvention report. This is where insurers can harness the power of the cloud. We see this flexibility playing out as innovation and innovation are implemented through new distribution channels, expanding the insurance market.
So, while insurers continue to explore the potential of blockchain migration to reduce their technology liabilities and reduce costs, they are also using the power of the cloud to drive new opportunities. See how three insurers are approaching the cloud in our future-ready insurance Webinar.
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