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A Solid Core: Achieving Legacy Transformation Faster, Cheaper and With Less Risk - White Paper

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The back-end technology infrastructure in most large and mid-sized insurers is a maze. It is often a complex web of multiple core systems, many aging, many creaking at the seams, and generally acting as a limit to business growth. Often these systems are linked together with aging application programming interfaces, resulting in such a dense infrastructure that the cost, risk and business disruption associated with a rip and replace strategy is just not feasible. This is true of all established economies with a long history of insurance. Our research indicates that established insurers in the UK have a number of core systems implemented – some of which are home-built and others acquired – contrasting with new challenger brands from new start-ups from outside the industry or outside the local market. Back-end technology is often a complex web of multiple core systems, many aging, many creaking at the seams. New insurance businesses have the luxury of being able to start with a clean sheet of paper. Start-ups can implement the latest technology platforms, which are flexible and adaptable to change. They can operate through online or multiple channels and, by doing so, will potentially be more competitive in the marketplace. New insurance businesses are able to launch products faster, add distribution channels on the fly and provide their customers with the journey they want seamlessly. On the other hand, organisations with legacy systems need to balance their lack of competitiveness with the pain and cost of implementing a new core system. The benefits need to be proven to be very compelling. What we do know is that all insurance businesses are looking to drive sustainable, profitable growth, and therefore need to find a way to do this as painlessly as possible.

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