How Secure are Systems Now in the Insurance Industry?
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How Secure are Systems Now in the Insurance Industry?
In this Insurance Asia article, EPAM’s Raphael P. Young, Head of Financial Services, APAC, discusses how AI is pivotal in transforming insurance claims management by reducing costs, enhancing efficiency and speeding up processes.
A growing consensus amongst insurers that integrating technology is proving to be the most challenging aspect, despite their successes built on legacy systems. However, this digital shift has increased vulnerabilities, leading to a rise in data breaches, phishing attacks, and ransomware incidents, which have surged by almost 20% annually.
Industry experts tell the urgency to adopt comprehensive technology and training strategies to mitigate these risks.
This includes qualifying artificial intelligence (AI) models from a security perspective, ensuring proper patching, and maintaining up-to-date product versions. Training programmes are also essential not only for staff but also for customers to enhance overall cybersecurity awareness.
“There are also increasing demands being made by data protection legislation, and the insurance industry has been largely in support of these changes,” Shrinidhi Kumar – vice president of Global Delivery, NTT DATA, told Insurance Asia.
Insurers are responding with advanced technology solutions and improved vendor management practices. However, these adaptations increase compliance costs and policy servicing expenses.
Consequently, insurers are turning to regulatory technology, a sector forecasted to grow by 20% globally, with Asia expected to lead this growth.
Prakash Thomas, head of Sales – Insurance, JAPAC & EMEA at Oracle, told Insurance Asia separately that backend legacy systems are the most significant constraints for insurers today.
With the introduction of more complex products, there is a pressing need for a flexible IT ecosystem that can rapidly adapt. “Cloud technologies and solutions play a crucial role in the industry,” he said.
Operational efficiency, a broad term encompassing various aspects, is one of the key benefits insurers can expect from this migration.
It goes beyond saying that automation and data handling are critical components because data is vital for risk underwriting, actuarial modelling, and product personalisation.
The agility offered by cloud solutions enables insurers to respond swiftly to market needs and consumer preferences.
AI and automation
For the insurance industry, AI can significantly improve data consolidation across systems whilst enhancing compliance measures in areas such as anti-money laundering and risk management. It enhances ETL processes by analysing data structures, automating mapping, and addressing data quality issues.
As such, AI and machine learning stand as vital pillars in the industry. Recent surveys, including one targeting around 200 global insurance executives, revealed a burgeoning consensus: AI is not just a distant promise but an imminent reality.
A significant 57% of respondents already perceive AI and machine learning as having a profound impact on their businesses, with a third anticipating the most substantial effects within the next five years.
This sets the stage for what Raphael Young, head of Financial Services APAC at EPAM Systems, aptly described as a “mega-trend” with transformative potential.
The focus on AI is not merely about keeping pace with technological advancements but is part of a broader, more holistic strategy.
“We are gearing ourselves up in multiple areas. First, we are focusing on our leadership team and people. Then, we are setting the right organisational structure, processes, and products for our go-to-market strategy,” Young explained to Insurance Asia in a separate interview.
Read the full article here.
Learn more about what’s driving the insurance landscape in APAC today. Find out about the cutting-edge strategies and approaches insurance companies are adopting to implement digital insurance in APAC: https://www.epam.com/insights/interviews/breaking-down-the-digital-insurance-ecosystem-in-apac
Find out how EPAM helps engineer the future of insurance by infusing business strategy into technology-enabled solutions to drive superior outcomes:
