How the Insurance Industry is Adapting to the Digital Revolution

While the insurance sector has taken longer to transition to a digital and data-driven era, the advantages of enhanced efficiency and deeper customer understanding suggest that this transition is becoming more urgent.

One of the main insights in the report "Digital Modernization in the Insurance Industry: How to Drive Progress in Your Organization," produced by EPAM in collaboration with London Research, is that insurance companies are gradually realizing the necessity of change. The findings indicate that less than half of the organizations surveyed regarded themselves as 'advanced' in terms of business transformation, with a marginally greater percentage observing 'substantial' progress.

The need for complete business transformation or operational restructuring has not been pressing until recently. However, unique and shared challenges across industries are now necessitating change in the insurance sector.

Navigating Legacy Technology

Legacy technology infrastructure is the prominent obstacle in the way of digital adoption and new working methods for insurance companies, as identified by 45% of businesses surveyed. This issue hinders innovation, impacts internal and external experiences, slows down speed-to-market, and strains IT teams maintaining and upgrading it. Moreover, makeshift solutions implemented by frustrated staff amplify future potential issues for IT departments.

Other factors compounding the legacy tech problem include a lack of digital leadership (cited as a major problem by 38%), lack of alignment between business and IT (38%), lack of a business case for changing the way things are done (35%), lack of funding (34%), and lack of executive support (32%).

AI is Transforming Industries – Are Insurers Prepared to Embrace It?

As per the survey, 57% of respondents acknowledge that recent AI and machine learning developments are set to notably influence their business, with 24% foreseeing it as the most impactful factor in the next five years.

Read the full article here.

Access the report here.