Your organization’s legacy systems are holding you back, trapping your IT team in a merry-go-round of reaction-based solutions to help solve deeply rooted infrastructure problems.
Your CEO sees the need for change and wants to modernize the organization’s life insurance platform in order to create modernized experiences.
But you know that modernization is not easy or cheap. Like rebuilding an old sports car, it’s never as simple as just replacing the engine. The parts and pieces that connect to the engine are just as vital to building the reliable and smooth-running car of your dreams.
Rushing into an overhaul or rebuild without understanding how all of the pieces connect can be disastrous. From billing to underwriting, claims and cash value, an effective infrastructure depends on everything working together. By focusing on just one or two pieces of the puzzle, you could create unnecessary complexity and maintenance, technical debt, and more opportunity for future errors — all of which will add more stress to your IT team.
Life insurance carriers have the added challenge of policies with less frequent renewal cycles. When policies are in place for decades, insurers build extensive platforms or ecosystems that can be costly to convert into a new system.
But when 88% of insurance professionals believe that legacy systems are preventing incumbent insurers from transforming quickly enough to keep up with customers’ needs, what are your options? How can you support your organization’s need for efficiency as well as your IT team’s sanity?
Evaluate your life insurance software upgrade options
There are three routes that your organization can take when it’s time to bite the bullet. Every IT leader should understand these three methods and how they will impact not only the organization’s operations but their team as they complete the work.
Rip and replace. While this option may be the “cleanest,” by replacing your entire system with a completely new platform, it’s also the costliest in both time and money and can be the most risky to undertake. It also provides the least amount of immediate benefit to your organization and your IT team.
For organizations without hope for their current legacy systems, a “greenfield” approach might make the most sense. A Greenfield Technology Platform allows you to start with a blank slate without disassembling your current system. This allows you to build a new offering that gradually replaces and integrates with the legacy system functionality. While your team will save time in comparison to a complete rip and replace, a greenfield approach does require management of additional systems and will not solve your current technical debt or maintenance requirement challenges for those systems already in place.
Outside/in approach. Starting with one challenge area can be a digestible way for your team to tackle modernization. You’ll see the most immediate reward from this method within the organization. However, your IT team may not feel this relief as you add in and interconnect another system into your older legacy. Additionally, you will never achieve the full benefits of connecting a modern solution with a legacy system.
Inside/out approach. This approach will provide the most recognizable benefit to your IT team with the reduction of day-to-day software management and maintenance. By starting with the individual policy records and customer journeys and then building out the rest of the ecosystem around them, you’re able to make more strategic infrastructure and code decisions that will reduce technical debt and increase automation and workflow efficiency. By replacing your core with coretech, you then have the cloud-based flexibility to add and change systems, as well as the resources among your team which is no longer stuck reacting to constant legacy-caused hiccups. An added benefit? Those investments in modern technologies over the past few years can now achieve their true potential.
Best practices for your insurance software IT team
So, you’ve made the decision to take the plunge into a system overhaul and implement a new SaaS life insurance platform. Here are some best practices to create the best project experience for your IT team:
Have good, strong governance in place. Buy-in from all aspects of the organization allows your team to move quickly and with confidence. Include members of your IT team alongside members of the organization’s C-suite, underwriting, sales, claims, and service teams.
Align your decision to corporate objectives. Understand your organization’s short- and long-term objectives before deciding which route to take. Without this knowledge, you could waste valuable resources and add more work for your team. For example, if your goal is operational efficiency and reducing operational costs, it would make sense to add services such as underwriting and claims to your existing business along with the technology resources to support them.
Partner up. An outside perspective from a specialized consultant who understands technology, the insurance industry, and your operations objectives can act as a systems integration partner and provide guidance on systems mapping.
Lean on your vendor. Another partner in this journey is your technology vendor. When evaluating vendors, make sure they understand your strategy and how they can truly support you during the transition and integration process. Your technology partner or vendor should be your partner: a direct extension of your team and organization.
Ready to help your team transition to coretech in a thoughtful and strategic way? Get in touch.