How insurers can choose the right tech partners
‘Traditional insurance businesses need the ability to harness customer data and to develop new digital products that can scale’
The need to digitise processes, overhaul operations and deliver a frictionless customer experience has come into sharp focus due to the pandemic. Consumers are looking to carry out end-to-end customer journeys online, whether their mission is to buy pet insurance or to identify the right travel insurance package.
Challengers that can offer consumers ease, speed and transparency when they are looking for quotes have emerged. Take Bought By Many, which has leveraged social media and search engine optimisation to group together people with similar insurance needs (for instance homeowners at risk of flooding) and negotiate a better deal with insurers than they could individually.
To compete on a level playing field, ‘traditional’ insurance and financial services businesses need the ability to harness customer data and to research, develop and test new digital products and tools that can scale. Then bring them to market at speed.
But they face hurdles due to cumbersome processes and creaking on-premise systems which support databases and software that cannot easily be updated or transferred to the cloud.
What to consider when picking vendors
Technology partners will be needed to assist in upgrading and re-platforming systems with minimum downtime or to provide easily integrated services that deliver the innovative experiences consumers now demand. Budget-holders and decision-makers will need a framework to evaluate whether a solutions provider can deliver at the lowest cost possible, in the fastest time, with the lowest risk profile.
There are some essential points to consider when researching a technology vendor. Top of the list is experience - have they worked on a platforming project with a business at scale before and can they guarantee performance when the systems are under load? What case studies can they show to illustrate success in your field?
Examining the pricing model and if it works for your business is vital - is it a flat fee or a subscription-based model with recurring fees? Establish what analytical tools are provided to track performance and customer behaviour on site.
Understanding the costs from the start
Costs can mount quickly. Will the vendor expect payment for every future change requested or will they take a longer-term view and see the relationship as a partnership with potential for future growth? It’s necessary to understand the ongoing support model for your business once the project is completed. Make sure it’s clearly understood which requirements will fall to your IT team and which remain the responsibility of the vendor - and that they are set out in detail in the Service Level Agreement.
The costs of downtime are huge, so is it easy to add apps, plug-ins and integrations without disruption to the core service? Flexibility to meet changing requirements or pivoting business models is also essential, so what is the potential for customisation?
And finally, with security and privacy a priority issue to build trust, can the vendor prove it takes both seriously? Any insurance business looking to implement change – whether the integration of a plug-in or a wholesale digital transformation - needs a provider experienced at working on tasks of the same technology, scale and sophistication.