As the marketplace moves toward digital technology, the need for faster and less expensive solutions is elevating the role of core systems into front-office interactions. This is driving carriers across the industry to replace these systems in order to realize competitive benefits from a state-of-the-art technical solution.
Executive SummaryEY collaborated with Gartner to survey 202 property/casualty insurance companies to better understand the current policy administration transformation landscape. Here, EY representatives present survey results indicating that there's now a clear and compelling business case for such transformations and report on the progress of surveyed carriers to date. Part 1 of a three-part article series. Related articles:
- Part 2: Getting It Done: Keys to Policy Administration Systems Transformation Success
- Part 3: Advancing a Digital Agenda: Policy Administration Transformation Is Step 1 for Carriers
Carriers have always been reliant on their core systems—policy administration, claims and billing. There has been a reluctance, however, to replace these systems in their entirety even as they became obsolete because of the cost and complexity. The tendency has been to disguise legacy system limitations to end users by building new front-end interfaces or, if necessary, manual intervention. But these solutions have become costly to maintain and have failed to resolve the underlying issue.
EY collaborated with Gartner to survey 202 property/casualty insurance companies to better understand the current policy administration transformation landscape. Respondents were asked 31 questions to provide details of their experiences in three phases: planning, transformation and post-transformation.
The survey results provide information about the current state of the marketplace, common occurrences during a transformation, as well as insight to carriers’ overall impressions of the process and, in certain cases, the outcome of the transformation. (See related article, “About the Survey,” for demographics of respondents.)
A Springboard for Improvement
There is significant market activity around policy administration. Of the respondents, 93 percent have started a policy administration transformation, and 51 percent of those have completed their transformation. The responses show that U.S. carriers have the most transformations in progress (50 percent), while in all other regions the majority of respondents have completed their transformation.
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