Nearly 40 percent of insurers remain unconvinced or dissatisfied with cloud computing, according to the results of a new survey, “Is Moving to Cloud Worth It?” by Celent, a research and advisory firm to the insurance and finance industry.

The company conducted a survey of its Executive Panel to explore insurer perspectives covering their move to the cloud, whether it was successful, the challenges they experienced, as well as the benefits they achieved.

Though the project was successful for some, many reported it wasn’t easy or were dissatisfied with the return on investment (ROI) or didn’t achieve the full value they anticipated.

The most common challenges to achieving insurers’ cloud goals were related to organizational readiness and skillset gaps.

“Service level agreements (SLAs), misalignment and security concerns also impacted satisfaction,” the report stated.

The lengthy time it took to complete the project was also noted as a downside to moving systems toward the cloud. Insurer cloud programs that took more than two years were said to not be worth the investment. The respondents noted that for projects that took three months or fewer, the move was worth it.

The largest insurers — 50 percent of those with $5 billion or more in revenue — were twice as likely to report time overruns on their cloud projects compared to other insurers, the survey found.

Markers of success were similar among carriers. Though staffing pressure release and cost reduction were the least mentioned source of value for cloud projects — outstripped by operational efficiency, disaster recovery and speed to market — it was the most identified marker of satisfaction, the analysis found.

“While insurers are focused on business value more than bottom line in undertaking their projects, the final product easing budget is a key indicator of whether the outcome is viewed positively,” the report stated.

Key sources of value from cloud solutions for insurers are data management and product innovation.

“ROI and value realization will truly depend on the effectiveness of data management, including quality and governance. Don’t underestimate the need for organizational readiness, training and change management. Take advantage of a cloud provider’s experience, best practices and lessons learned,” said Nanda Rajgopal, principal analyst at Celent.

Celent’s research indicates the steps an insurer can take to ensure a successful cloud transformation.

“Depending on the complexity of an insurer’s IT portfolio and environment and the level of workloads being moved to the cloud,” the report stated, “it will come down to migration methodology, portfolio transformation decisions, people, process and tooling/solutions.”