Looking Ahead to 2013: Insurance Technology Adapts to New Devices, Changing Needs
As the New Year is poised to begin, insurance companies continue to see some long-term trends in technology.
Just as with other sectors, mobile devices continue to be increasingly popular. Even last year, there was a clear direction toward mobile options.
"Mobile apps don't replace everything we do on the PC, but we are going to be targeting things where it makes sense," Kirsten Pedersen, vice president of operations at Penn Mutual, told Insurance & Technology, last year in a statement, which continues to ring true. "There are going to be places where it is appropriate to do the mobile app, such as making it possible for producers to get information on pending cases."
One unique aspect of insurance transactions is that they do not take place as often compared to other fields, such as retail or banking. So it is less likely that consumers will put a portal on their mobile device for insurance purposes, Insurance & Technology reported.
In addition, Bring Your Own Device is another continuing trend for insurance technology.
Also, IT employees – including those in insurance – are advocating more for the storage of data and content in the cloud. Recent storms, no doubt, encouraged the trend.
And big data is very important for the financial services sector, such as insurance. “Some may even contend that it (financial services sector) is helping to lead the charge,” Insurance & Technology observed. “Big data is inescapable in today’s financial services industry – from new types and levels of customer information flowing into the organization to record volumes of transactional data.”
And another issue that needs to be addressed relates to healthcare exchanges. Just 14 states and Washington, D.C., expect to operate healthcare exchanges, which means the federal government will have to come up with adequate online marketplaces for some two-thirds of the United States as national healthcare reforms go into effect.
“The administration will have to engineer an information technology system capable of processing operations in a way that meet the needs of healthcare consumers in different states,” Reuters explained in a recent story. “Experts say the biggest challenge will likely be providing adequate customer service to handle enrollment, as well as fielding a technology system capable of interfacing seamlessly with the system of each state government.”
Looking back, the insurance technology sector saw some other clear trends in 2012, such as on core system modernization.
There is a differentiation between Tier 1 and 2 insurers and among regions, according to Cummings. In 2012, Tier 1 insurers in North America, Western Europe and Japan moved to “best-of-breed” systems to replace legacy applications.
For Tier 2 insurers, and insurers located beyond North America, Western Europe and Japan, there was a different picture.
“Almost half of the RFPs [request for proposals] coming into our company ask either about a platform for core insurance (usually meaning policy, claims, billing, reinsurance and sometimes commissions)," Cummings said.
Also, in 2012 fewer than 25 percent of SAP's inquiries were for stand-alone components. That compares to a two-thirds decrease from 2010.
"We believe that 2013 will see a continuing strengthening of this trend, with the difference that subsidiaries of Tier 1 players will also begin to consider full suites due to the cost disadvantage of large heterogeneous systems," Cummings adds.
This compares to 2011, when carriers were “weighing their core system replacement options… from monolithic suites to best-of-breed systems, and now to best-of-breed suites."
Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO Miami 2013, Jan 29- Feb. 1 in Miami, Florida. Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.
Edited by Brooke Neuman