A Christmas Carol from the Celent Insurance team

Dec 23rd, 2010 | Posted by

Unlike Charles Dickens’s marvelous work, this is not a ghost story, but it is intended to raise a Ghost of an Idea, which shall not put my readers out of humour with themselves, with each other, with the season or with me. May it haunt their houses pleasantly, and no one wish to lay it.

The first of three spirits

Legacy system issues continue to haunt Insurance CIOs, but never fear, Celent has a wide range of reports on the topic that continue to be relevant. And with a legacy system survey just completed, more content will be coming shortly. Many insurers face the prospect of having more insurance core systems than they need, with consolidation efforts certainly high on the agenda.

Modernisation has been a repeated topic for Celent reports, and approaches have evolved over the years. Below is a selection of reports looking at elements of the problem – not least of which is assembling a case for doing the work.

The Challenge of Legacy Modernisation, Part 1: A Data View, November 2008
Taking on the Legacy Challenge: A Swiss Insurance Business Case, December 2008
Controlling the Risk in Insurance Data Conversion, December 2010
The Labours of Hercules: The Challenges Facing Insurance Enterprise Architects, June 2010

And from our Banking colleagues – A Christmas Carol: Wells Fargo Sings the Praises of SOA, December 2007

“I told you these were shadows of the things that have been,” said the Ghost. “That they are what they are, do not blame me!”

The second of three spirits

2010 has been an incredible year of change. The financial crisis has had a major impact, perhaps one that leaves us in mind of weakened but ever optimistic Tiny Tim. As the crisis continues to rumble on, one must ask – is this a temporary thing? Something truly of the present and soon forgotten? This topic is well covered in Celent’s report on the new normal.

On a lighter note, it is fair to say that mobile has arrived as a channel for the insurance industry. With so many insurers investing in the medium, interest from customers and partners in this new direct channel seems to have evoked the imagination of the industry even more than the Internet did.

Meanwhile modern insurance core systems offer more promise than ever, whether they be end-to-end solutions or components thereof. Celent’s coverage of claims vendors and PAS vendors is still of great interest as many insurers invest in their technology platforms. The functionality and flexibility in these systems are unprecedented, and now, if ever, is a great time to review a core systems strategy.

Some relevant reports:
Is Today the New Normal for the US Insurance Industry? October 2010
North American SnAppshot: A Look at Mobile Apps Aimed at Insurance Consumers, November 2010
North American Life Insurance New Business and Underwriting Systems, 2010, November 2010
European Claims Vendors in 2010, June 2010

“My life upon this globe, is very brief,” replied the Ghost. “It ends to-night.”

The last of the spirits

And so to the future, and a mysterious one it is too. There is a great shift occurring in the way people communicate, discover services, and make use of them – perhaps greater than the adoption of the Internet. The implications are not yet well understood. The more the Internet can be accessed anywhere, the more people that are creating more content and sharing more information, and the more that mobile and social technologies will play a key role.

How will agents interact with customers? How will customers purchase insurance? How will claims assessors share their findings?

On top of this, the way business is done is being challenged. Now it is possible to find third parties that are almost like being able to rent a piece of a business. IT services of all shapes and sizes are on offer, and IT hardware and software can be rented for nominal rates with SaaS options. The way to run enterprises large and small is changing, bringing opportunities and threats to the industry.

E-Business Strategies for a New Mobile World: Considerations for Insurance, November 2010
IT Services Vendors Solutions Spectrum: EMEA Version, 2010, November 2010
IT Services Vendors Solutions Spectrum: North American Version, 2010, April 2010
Leveraging Social Networks: An In-Depth View for Insurers, April 2010
Approaching the Boiling Point: BPO, SaaS in Insurance, November 2010

Oh – and our event in London: ” New Rules of Engagement: How Digital and Social Innovation Challenge the Insurer Business Model”

“.. Assure me that I yet may change these shadows you have shown me, by an altered life!”

The End of It

We here at Celent wish you all the best and a happy holiday period. Forgive the weak link to the great work herein and rest assured we look forward to working with you into 2011 and beyond.

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