Digital progress is also putting pressure on insurance companies. One challenge for insurers is the gap between current technological possibilities and the need to offer customers a fully digital omnichannel offering.
Cloud transformation: Software-as-a-service solutions play an important role in the future of the insurance industry and help companies remain competitive.
venusvi / Generated with AI / Stock.adobe.com
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Since many insurers often still rely on slow, manual processes and work with legacy systems, a modern customer experience is not feasible in many cases. In contrast, today’s market demands demand fast, efficient, intuitive, automated and mobile services. Although this development has already led to a rethink in the industry, there are still many obstacles to implementing digital goals. However, software-as-a-service (SaaS) models offer a solution that enables insurance companies to drive their transformation quickly and securely.
SaaS models bring more flexibility
As is usual with SaaS models, insurers save themselves the high initial investment for the required infrastructure, licenses, hardware and their maintenance. Outsourcing IT also involves a reduction in costs, including infrastructure management, cybersecurity, backups and updates. The choice of a provider should always be based on industry-specific expertise: only those who really know the day-to-day work, challenges and needs are able to provide new products, features and suitable interfaces.
This comprehensive expertise is also necessary when it comes to questions of scaling and flexibility – crucial aspects for an industry that must prepare for extreme events in addition to the new demands of daily work. It is therefore crucial that insurance companies and policyholders can rely on the software even in times of crisis, for example in the event of natural disasters or on so-called churn days, when a disproportionate number of customers cancel contracts or switch providers.
For efficient and customer-friendly handling of these – often unpredictable – events, a SaaS solution is necessary that offers maximum scalability and is not tied to hardware limitations. The providers should also guarantee the installation of new updates and patches, while insurers can continue to concentrate on their core business and their customers.
Strong regulation sets tight limits on the industry
Not all SaaS is the same. This is especially true in a highly regulated industry such as insurance. While companies in the private sector are free to decide whether or not to use the cloud, insurers do not have this freedom. Working with highly sensitive data is subject to strict restrictions regarding storage location and use.
When choosing a SaaS solution, it is therefore important that, in addition to the cloud offering, there is also the option of continuing to store certain data on-premises and thus complying with legal requirements. This approach requires providers to continually invest in new technologies and the further development of protective measures – especially in key areas such as encryption, data backup protocols, monitoring or access control.
In addition, providers of SaaS models, especially in the insurance sector, should actively offer the individual design of the infrastructure – for example in the form of additional add-ons, a large ecosystem and open interfaces.
