Digitisation in the insurance industry

For the insurance industry, IT must be classified as the most important production factor, although its importance will increase as our society becomes more digital. A particular challenge arises from the fact that essential functionalities and processes of many insurance companies are still mapped in old IT systems and must continue to be operated. For an intensive support of this customer group, therefore, not only experience with proven technologies, e.g. using host systems, is required, but also innovative approaches both in the project approach (agile methods vs. classic project management) and in the development environments and tools to be used.

Challenges in the insurance industry

Traditional insurers are coming under increasing competitive pressure from start-ups and Internet giants such as Google and Amazon, which continue to push into the market. IT consulting is expected to provide solutions for the following challenges:

  • Meeting increased customer expectations through digitalisation
  • Strengthening competitiveness
  • Reduction of sales and process costs
  • Ensuring governance and compliance rules
  • Modernisation of IT and application landscapes

Use Cases in Financial Services

Numerous factors favour the current upheaval within the industry. In addition to constant competitive pressure, the low interest rate environment, new regulations and demographic developments, digitisation is a real opportunity for many providers to increase their own share of a market that is hardly growing at all. Whether digitisation is successful depends largely on whether companies can offer their customers a comprehensive customer experience. Customers of financial service providers are demanding new solutions ever faster.

Fully automatic "just in time" policy issuing

High Level Experience

Expansion of market share

Customer experience
and competitiveness

Insurance customers expect transparent products and services that they can easily take out and change when the legal requirements are met. These insurance services, which are mainly offered via the Internet and portals, should be personalized and tailored to their needs. They also demand greater clarity and information – for example, an overview of all their insurance policies, regardless of the line of business. To meet these requirements, accompanying services for digital consulting and adequate consulting processes involving the intermediaries must be created. In addition, IT service providers should have a command of the relevant standard products for customer experience or customer relationship management (CRM) and be able to assess their applicability to the challenges of insurance companies.

Modernisation of the IT
and application landscapes

Many traditional insurance companies are increasingly suffering from their old core applications, some of which are 30 years old and built in programming languages and architectures that hardly anyone knows today. Due to the high costs of conversion, many insurers have long postponed the modernisation of their IT. These legacy systems and heavily modified standard systems are increasingly reaching their limits. In particular, attempts are being made to achieve modernisation with a bimodal approach through web applications, the relocation of development and operating environments to the cloud, the use of APIs and microservices and the automation of tests.

Guarantee of
Governance and compliance rules

Governance and compliance rules of the EU, the state governments and the regulatory authorities repeatedly require adjustments to the IT applications used. Insurers have to find cost-effective ways to take them into account in their IT service landscapes and integrate them flexibly. In recent years, the European Data Protection Basic Regulation (EU-DSGVO), Solvency II and the Insurance Distribution Directive (IDD) in particular had to be taken into account in the application systems.

Reduction of
Sales and process costs

With falling margins, the high distribution costs in particular are becoming a problem for insurers. They will have to open up to digital channels without upsetting their direct and structured sales agents, who still conclude the majority of contracts today. At the same time, they must significantly reduce their process costs by automating as much as possible previously manual business processes (such as claims settlement and policy issuing). To realise this potential, the use of AI and machine learning as well as the use of Big Data is essential.

Our IT experience in the insurance industry

PTA Unternehmensberatung has been supporting insurance and reinsurance companies for over 25 years in the design and development, and increasingly in the reengineering, of their information systems. In almost 300 projects, experience has been gained in almost all types of insurance and functional areas, and current developments in insurance IT have been accompanied, in particular by working on bimodal developments. The following focal points can be highlighted:

  • CRM: individual and standard systems
  • Optimisation of consulting processes
  • Implementation of regulatory requirements such as IDD and EU-DSGVO
  • Optimisation and extension of the standard system ICIS
  • Integration of traditional computing cores in cloud applications
  • Implementation of BiPRO interfaces

Below you will find some selected references regarding IT support in the insurance industry:

Industry focus

In our industry focus you will find further information on successfully completed projects in the industry
“Insurance”, clearly structured according to the processes you are familiar with:

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