Carriers willing to consider replacing legacy systems with cloud computing initiatives can reap many benefits.
Insurance organizations continue to face myriad challenges, even as the economy shows faint glimmers of recovery. While senior insurance leaders in 2008 were often forced to make reactive decisions, 2009 may afford those same leaders with opportunities to proactively improve core operations.
Driven by the necessity to both innovate and reduce costs, more insurers are considering cloud computing as a strategic initiative.
Cloud computing dramatically alters the current technology business model to deliver speed, cost savings and agility to insurers. By putting processes and data "in the cloud," issues such as servers, capacity, stacks, data-backup and disaster recovery are outsourced, saving expense and enabling insurers to focus on innovation.
Analyzing where cloud computing can impact your team's performance depends upon a frank assessment of your current processes and the underlying technologies. Ask these questions:
- How do we manage agent administration, total agent care and on-boarding processes?
- How integrated are our policy administration processes?
- How deep is our policyholder knowledge?
- Can we accurately track field sales forecasting, pipeline and sales visibility?
- Is our customer service management fully integrated?
- How automated is our policy quote processes?
Creating a technology blueprint of your organization's current state will help to begin the process of defining where cloud computing can augment or replace legacy technology solutions. For insurers who can effectively identify specific sub-processes in quote, claims, policy administration or agency management, well-designed cloud-based solutions can mirror industry specific solutions while offering broader flexibility and scalability.
Cloud computing, partnered with a supporting IT environment, enables firms to exponentially power their business platforms as new initiatives occur in a fraction of the time compared to a traditional IT approach. The cloud computing approach delivers speed and agility for the insurance organization, enabling them to easily adapt to changing business environments.
In the past, cloud computing has typically been associated with lighter applications such as customer relationship management (CRM) or sales force automation (SFA). However, acceptance is rapidly growing among insurers to look at cloud-computing solutions for areas of operations once considered too mission critical. For example, policy administration supporting the end-to-end lifecycle management of policyholders is typically one of the most expensive operating areas for carriers and underwriters.
Cloud-based policy administration is a great example of a vertically integrated set of complex workflows that reflect the growing maturation of cloud computing solutions as strategic initiatives for insurers.
Not all cloud computing advantages are financial- or solution-based. New intuitive cloud computing components are being added, which can breathe life into core functions. For example, Salesforce.com just released its Genius feature which, much like Apple's iTunes feature of the same name, can aggregate customers with similar characteristics to provide an insurer with key data to help drive future product, marketing and sales decisions.
The potential is great for forward-thinking insurance organizations to take a hard look at the sacred cows of their company's business model and ask, "Can it be done faster, easier, cheaper?" By leveraging cloud computing in conjunction with a knowledgeable cloud computing consulting partner, insurance companies can benefit from increased productivity and profitability - all with a more affordable approach. Innovative insurers that take advantage of cloud computing may find sunshine even in today's business climate.
This article can also be found at InsuranceNetworking.com.
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