Cloud Solutions | Georgina | 14 May 2021
With 2020 demonstrating the largest ever shift in the way we work, many businesses are considering long term strategies to future-proof their systems. Insurers are among these businesses, weighing up the pros and cons of cloud migration. It’s not an easy ‘lift and shift’ process for many, with legacy systems, for example, being very complex to migrate and no longer fit for purpose. Cloud readiness is next on many insurers’ agendas.
Why it’s time insurance went the way of the cloud
Insurance, particularly in the UK, has had long-standing, traditional methods of processing claims. Over time, and as other industries (e.g. finance and travel) become more digital-facing, insurance needs to keep up on these markets. Eventually, it’s going to cost insurers more money being left behind. Legacy systems become less fit for purpose, less secure and more inconvenient to manage. As the talent who implemented those systems will be due to retire in the next few years, it’ll become more and more difficult to manage these systems as more time progresses.
Benefits of moving to the cloud include;
- reduced cost
- improved reliability
- increased security
- speedier go-to-market for new products and services
- better customer service (and experience for the end-user).
The above all sounds great; especially when insurers must continue to stay ahead of the competition.
However, there’s a lot that needs to be planned out first. A cloud-readiness assessment would be one of the first internal projects an insurer should undertake before proceeding further towards the cloud. So, what questions should insurers start with?
Firstly, the four critical areas of business must be assessed as part of the internal questioning process: people, process, technology and business.
Question #1: What are our priorities?
Undoubtedly the most important question is to ascertain where the most effort is needed in the business. Moving to the cloud isn’t easy. However, there may be components to your infrastructure that can easily be migrated into the cloud. It’s important to carefully examine all areas of the business and the likely effort that’s required to begin a cloud strategy around it.
Question #2: Do we have the talent for this?
You could have the best cloud transition strategy in history, but it means nothing if you do not have the resources to implement it. Many firms rely on third-party expertise to overcome this hurdle after finding that achieving it internally is expensive and high-risk.
Question #3: Which areas of the business benefit the most from cloud readiness and why?
Exploring the benefits of the cloud, in general, is easy. However, all insurers have their own idiosyncrasies and complexities behind the scenes. Are you looking to integrate and restore the channels between IT and various lines of business? Cloud can do this; and quite substantially. Links between sales and IT can also be bolstered by adopting a solid cloud strategy. Exploring why areas of the business will benefit from the cloud will also force insurers to examine what exactly they’re trying to achieve.
Question #4: What’s the management strategy post-migration to the cloud?
Migrating to the cloud itself may seem like the biggest hurdle to cross; but what happens afterwards? Do you have the talent in-house to manage your new cloud-based systems? What’s the process if;
- there’s an outage
- a security leak occurs
- certain talent leaves the organisation
- an upgrade is due
- you want to implement more features and products?
All of these things need careful consideration; and undoubtedly their own strategy and timeline. This is what cloud readiness is about. Not everything can be planned for – but in such a risk-averse industry as insurance, it’s imperative to think these things through in the early stages, instead of post-implementation.
Overall, cloud adoption seems to be on the cards for many insurers; there isn’t a common reticence to go down this path. Albeit a promising step into the future, there’s still a long way to go. If there are stages of your cloud readiness plan you could use extra advice on, you should get in touch and we’ll be happy to help.
