Insurance companies faced a stretch of unparalleled challenges and difficult decisions – then the pandemic hit.
Projects devoted to deploying new insurance technology found themselves competing for attention with an overwhelmed IT team. Juggling a greater reliance on remote work and an increasing volume of policy claims posed a technical challenge.
At the heart of the problem is an unhealthy mix of legacy applications and innovative new technologies. While every established insurance company would appreciate if the two sides held hands and got along, it takes effective planning and efficient use of resources to integrate the pair. When successful though, businesses gain a substantial competitive edge.
Running parallel are emerging challengers in the industry, who are steadily challenging household names. These new arrivals entered on the cloud and offer a digital-only service, built on a dynamic customer experience offering with artificial intelligence and machine learning helping them find their next initiatives.
Incumbent insurance companies must now accelerate their digital transformation to keep pace, or risk being left behind. One competitive advantage they’re turning to is third-party software maintenance.
Insurance and its Technological Renaissance
Nearly every company over the last 20 years has taken strides to transform into a technology company. Automakers are rebranding themselves as tech companies. Banks are rebranding themselves as tech companies.
Insurance is no different.
Established, trusted brands that have dominated the space for years are facing immense competition – the likes of which they’ve never seen before. Quick and agile insurance startups are able to challenge for a considerable share of the market with innovative pay-as-you-go plans, no-hassle claims processes and a digital-first customer journey.
To meet this challenge head-on, insurance businesses can’t think of their products from a traditional standpoint. Their products must carry an acute focus on the technology that supports them, whether it’s from the perspective of developing them internally or making them available externally.
Just as Google broke into autonomous vehicles, insurance companies must search for the vehicle that can carry their technology.
Of course, all of this is easier said than done. Fortune 500 insurance companies that have built considerable brand trust with consumers over the past few decades are partially compromised due to their success. The strategies that helped them establish a foothold are now the obstacles holding them back.
With multiple acquisitions under their belts, they’ve consolidated underlying technologies into environments that are stable and highly reliable – but not very agile or flexible. With legacy infrastructure as the foundation, they’re finding it difficult to shift their IT operations and general culture to respond to new contenders in the industry.
The key to challenging the new kids on the block is as simple as understanding where legacy technology is holding back the business, and how to reduce the risk surrounding it.
Welcome, New Insurance Technology
How can insurance providers utilize new AI, blockchain and customer experience platforms to their fullest while maintaining legacy infrastructure?
The best approach is to stabilize the legacy technologies, extend their lifecycles and enhance their functionality.
By limiting the attention that needs to be paid to products like IBM® MQ, Db2, Cognos and WebSphere Application Server, companies free their best and brightest technical experts to focus entirely on new technologies. This creates:
- Efficient use of resources
- Agile innovation
- Ability to compete with new entrants
- Quicker project delivery times
Everyone that works with legacy infrastructure, however, understands that extending its lifecycle and enhancing its functionality isn’t simple to do. Under expensive software support agreements, OEMs consistently push for product upgrades and only service the software if it’s a supportable version. The need for new product features or functionality is usually associated with the high cost of a software upgrade.
Insurance companies must find the right partner that can keep their legacy infrastructure safe, stable and secure – without hamstringing themselves financially. On top of that, the partner needs to be able to support the product within the context of the changing digital environment. Delivering recommendations that go beyond how to keep the software running is critical to maximizing business results while lowering fixed costs.
Insurance Companies Look to Third-Party Software Support
Many insurance companies are looking to third-party software support providers to find a partner to maintaining their legacy infrastructure so they can carry out their IT roadmap.
Third-party software support allows businesses to make strategic decisions on their legacy infrastructure. This could take the form of keeping the software stable for a year while they develop, test and deploy its replacement technology, or simply extending the stable version that’s currently in place so as to avoid an upgrade project.
In fact, nearly 4 in every 5 companies are currently using third-party software maintenance in some capacity, according to a Forrester Consulting study. Only 14 percent of businesses work solely with OEMs to support their software.
Origina works with a number of Fortune 500 insurance companies to help them stabilize their legacy infrastructure and give them the product expertise necessary to extend its lifecycle.
Third-party providers like Origina are able to bring a refreshingly proactive approach to legacy technology. Independent Global IBM® Experts with over 15 years of experience in their product are able to deliver sustainable performance while accounting for interoperability concerns with newly adopted cloud and SaaS technologies.
As a bonus, all of it can be done while cutting fixed annual support costs in half and without the need for version upgrades.
The money saved by switching to third-party support is often funnelled back into the IT budget toward innovative projects that revolutionize the customer experience or otherwise give the business an edge. Paired with the peace of mind that the legacy infrastructure is being maintained, the relationship allows established insurance providers to take a gigantic leap forward in becoming a digital-first business.
Third-party software support helps large insurance companies take control over their IT roadmaps. Where OEMs may try to derail a migration or decommission project because it signals lost revenue, third-party support providers have stepped in as strategic and executional partners.
Make the Switch to Third-Party Support
Origina works with multiple Fortune 500 companies, helping them to cut fixed costs by 40 to 50 percent annually, stabilize their legacy infrastructure and carry out digital transformation.
Before making the switch, customers have the opportunity to identify critical IT initiatives where Origina can lend a hand. Instead of only supporting the software itself, Origina’s team will maintain the products within the context of the projects they’re involved in.
Learn how Origina can help your insurance company compete with new challengers and carry out its IT roadmap.