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An insurer on five has not upgraded their legacy systems, according to Celent

by

Justine Montminy

7 March 2018 13:30

Photo : Unsplash | Javier Quesada

Nearly 20 % of insurers have not yet taken into account in the modernisation of their old legacy systems, while 70% of them have initiated or completed, and approximately 10 % will engage in modernization this year, according to a survey conducted by Celent.

The annual study made with the chief Information officers revealed their priorities for the current year. The investment in artificial intelligence and insurtechs are part of it.

An impact in the expansion

The impact of digital is expanding with life insurers, according to research firm specializing in technology financial services, a division of Oliver Wyman, which is a subsidiary of Marsh & McLennan Companies. Life insurers have all of the digital investments.

The initiatives in the field of artificial intelligence have advanced greatly within the life insurers, according to the report. By 2017, 10 % of respondents indicated anticipating invest in this. By 2018, 60 % of them expect to do so.

The IT investment remains stable

Celent says that the investment in information technology (IT) is stable since it is 4-5% of turnover for several decades. A total of 30% of the budget IT is allocated to the implementation of new systems, and 12 % is dedicated to innovation. The report qualifies these figures as “encouraging” as they show the willingness of insurers to invest in technologies.

A craze modest around insurtech

“The investment in innovation and the insurtech increases, but remains modest,” says the survey. 18 % of life insurers surveyed have expressed have implemented a solution insurtech while 40% of respondents are working with providers of insurtech.

12 % of insurers surveyed say they invest in the local community. “If an insurer invests in a company insurtech, it does not necessarily mean that they use the technology “, grade Celent.

The report, however, is optimistic by demonstrating that from 2017 to 2018, companies responding to the survey have gone from a passive participation to active participation in relation to their involvement in the insurtechs.

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