While insurers across all lines of business have similar priorities and challenges, there are some differences between life/annuity projects and property/casualty initiatives. In general, P/C insurers are more confident in their systems’ capabilities than L/A insurers are. L/A insurers are facing changing customer expectations while managing continued margin pressure in their legacy blocks of business. This means insurers in this space are prioritizing digital efforts, operating efficiency, and workflow optimization.
On the other hand, P/C insurers are striving to stay competitive in their market. The threat of adverse selection is a driving force behind property/casualty carriers’ continued push for better, faster product deployment and more enhanced analytics capabilities. More midsize P/C insurers to launch analytics-focused projects in 2019 than in previous years. These new trends may be why core systems replacement rates are on the way down. While more than 25% of insurers noted that they intend to replace their policy, billing, and claims systems, the overall rate of core replacement projects is lower than it has been in years prior.
Optimizing IT and staying ahead of talent issues are two other areas of concern for insurer CIOs across the board. Most CIOs are certain their teams can deliver the functionality their industry demands as long as they have the right talent. But carriers are struggling to find team members with the right technology skills, whether that means replacing employees skilled in near-obsolete programming languages when they retire or finding resources with experience in new forms of code.
For more insight into the way insurer CIOs in both P/C and L/A lines of business are using their budgets, read the full 2019 Insurer IT Budgets and Projects report.
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