This put up is a part of a sequence sponsored by AgentSync.
Right now’s insurance coverage companies depend on a mean of 5.7 to 11.9 completely different know-how platforms for day-to-day operations, relying on their complete income. For giant-scale carriers managing a number of companies and their downstream producers, it’s possible that quantity is even increased. Whereas this degree of digital innovation represents a constructive change within the insurance coverage business’s capacity to supply fashionable experiences to its customers and environment friendly workflows to its staff, cultivating a extra sturdy tech stack doesn’t come with out challenges.
Every time an insurance coverage group invests in a brand new digital resolution, it’s creating better efficiencies for at the least one piece of the insurance coverage distribution puzzle. When a enterprise begins out, it could solely have the sources to buy essentially the most important know-how, like an electronic mail utility and a bookkeeping software program. Because the enterprise grows, it invests in additional know-how to assist handle the rise in purchasers and staff — an HR system, a buyer relationship administration (CRM) system, a compliance administration resolution, and so forth.
Whereas these techniques little doubt create better efficiencies for the enterprise, there’s no denying the irony that the extra complicated your tech stack will get, the extra inefficient it will possibly change into. In actual fact, it’s not unusual that, as carriers and companies buy extra techniques, they uncover some large issues.
How does a posh tech stack impression your insurance coverage enterprise?
Poor integration capabilities result in fragmented techniques
The extra techniques you add to your tech stack, the extra essential it’s for these applied sciences to speak with each other. However with as a lot as 74 % of insurance coverage corporations nonetheless counting on legacy know-how for his or her core enterprise features, seamlessly linking current techniques to new ones in order that they operate collectively in a significant method isn’t precisely the norm. Older techniques use completely different knowledge codecs, protocols, and buildings than fashionable options. These variations may cause important compatibility points that make integrations extra complicated and finally result in system fragmentation.
Silos restrict good, data-driven enterprise selections
Your distribution channel is stuffed with knowledge on each downstream companion you’re employed with. Proactive insurance coverage organizations use this knowledge to intelligently develop, contract, and restructure their distribution channels in response to shifting market alternatives and challenges. In consequence, data-driven companies are 23 occasions extra more likely to purchase new prospects and 19 occasions extra more likely to obtain above-average profitability than their much less data-driven counterparts. Nonetheless, knowledge silos, a typical symptom of lackluster integrations between a number of techniques, make it troublesome to leverage producer knowledge for knowledgeable selections. Silos stop producer knowledge from flowing seamlessly by your techniques, creating a number of variations of fact in your information and making it troublesome to decipher the place essentially the most correct data really lives.
Scalability points stop worthwhile development
In terms of sustainable development, automated options have been an actual game-changer for the insurance coverage business. For instance, today, with the fitting distribution channel administration resolution, any provider onboarding an company and its a number of downstream producers can validate a number of licenses throughout a number of strains of authority and a number of states all on the click on of a button. Not all that way back, the identical course of was solely achievable by hours, if not days, of guide work. Nonetheless, not all automations are created equally and plenty of legacy applied sciences lack the flexibility to scale effectively, making it simply as troublesome to develop with out additionally growing overhead prices.
Disjointed techniques enhance safety and compliance dangers
Complicated and ever-changing regulatory necessities type the spine of the insurance coverage business (critically, we’ve a complete sequence about it), making compliance more and more complicated to take care of. Staying on high of laws and avoiding penalties is especially difficult whenever you’re coping with disjointed techniques which are unable to replace in real-time, creating inconsistencies in your distribution community knowledge. On high of compliance threat, knowledge safety is a significant concern for companies with a posh tech infrastructure. In a research inspecting the state of cybersecurity throughout the insurance coverage sector, SecurityScorecard discovered that third-party software program and IT vulnerabilities have been guilty for half of the info breaches reported by 150 high insurance coverage corporations.
Funds predictions reveal a better deal with lowering IT complexity
Between the pitfalls of a posh tech stack and the continuing market volatility and consequent finances tightening of the previous few years, it could come as a suprise that consultants predict an enhance in tech spend throughout the insurance coverage business over the subsequent yr. However, digging just a little deeper into the place and the way companies plan to make use of these funds paints a clearer image.
With talks of tech consolidation from big-name gamers like GEICO, and better stress on IT departments to ship quicker ROI, it’s possible we’ll see much less prioritization on multi-year, complicated technological overhauls and better funding in lower-lift, modular options to assist consolidate fragmented infrastructure, scale back vendor administration complexities, simplify workflows, and unlock deeper knowledge analytic capabilities.
The main focus shift makes much more sense when you think about the truth that many insurance coverage carriers and companies have already invested many years of time and tens of millions of {dollars} into their current techniques. In terms of their IT, these people aren’t seeking to reinvent the wheel a lot as they’re on the lookout for complement options that may enhance their effectivity with as little enterprise interruption as potential.
The answer: Investing in APIs to cut back tech complexity and enhance operational effectivity
For companies with current distribution channel administration ecosystems, utility programming interfaces (APIs) supply an answer for bettering operational effectivity with out ripping and changing present techniques. Modernizing giant and sophisticated techniques, like these used to handle your insurance coverage distribution channels, can take months or years. APIs scale back tech complexity and get essentially the most full and up-to-date producer knowledge flowing by your techniques extra rapidly and effectively than ever earlier than. Carriers and companies that spend money on APIs profit from their:
Improved integration capabilities: APIs combine straight into a corporation’s current platforms, opening the door for extra seamless knowledge trade between disparate techniques and eliminating bottlenecks in day by day workflows.
Seamless, safe scalability: By leveraging APIs that derive knowledge from business sources of fact, companies can focus much less of their time and sources on knowledge upkeep as their enterprise grows, and extra on taking advantage of the tech infrastructure that drives their core enterprise processes.
Actual-time knowledge: APIs can elevate distribution community knowledge high quality by synchronizing a corporation’s current tech (and the info that lives inside it) with business sources of fact. Fairly than counting on guide knowledge validation, APIs routinely guarantee producer knowledge is at all times up-to-date and helpful.
By leveraging APIs, insurance coverage carriers and companies can rework their tech infrastructure from complicated, fragmented, and inefficent to agile, linked, and fashionable. In consequence, they’ll keep away from spending the money and time wanted to finish a complete system overhaul and acquire better visibility into their distribution channel knowledge throughout their current platforms.
Let AgentSync’s ProducerSync API meet you the place you’re at
If tech complexity is obstructing key distribution channel knowledge from flowing by your current techniques, then your knowledge’s not doing you a lot good. From surfacing key producer knowledge when and the place you want it (assume earlier than binding a coverage or paying out a fee), to extremely refined analyses on find out how to optimize your distribution channel for max success, ProducerSync API may be the tech enhancement your corporation wants on the price and implementation timeline it desires.
Contact one among our consultants at this time to learn how your group may benefit from ProducerSync API.
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InsurTech
Tech