Last week, Novarica began its bi-weekly Virtual Panel Series. I was joined by fellow Novarica senior team members Matthew Josefowicz and Mitch Wein to discuss the recent update to Novarica’s Insurer IT Budgets and Projects report.
IT Priorities
Despite the pandemic, insurer IT spending and priorities are largely consistent with the past few years. The most significant shift recorded was the increased prioritization of digital initiatives among life insurers—data that is consistent with the results of a snap poll Novarica released in May. In comparison, property/casualty insurer priorities have remained consistent, focusing more on speed to market, analytics, and distributor support.
This prioritization can be attributed to the high levels of pre-pandemic digital maturity among P/C insurers. Another interesting, but maybe unsurprising, finding was that 75% of insurers reported plans to increase their cloud footprint.
IT Challenges
Insurers across the industry cited limited resources, talent availability, and managing a remote work force indefinitely as their biggest concerns heading into the new year. However, for some insurers, remote work has broadened the potential talent pool, allowing insurers to look beyond the competitive cities where their offices are located.
While the pandemic has accelerated some trends, it has not really changed the fundamentals of how most insurers are thinking about the business capabilities they need and what resources they need to deliver them. However, insurers with technical debt are realizing that delaying technical enhancements is no longer a sustainable strategy.
Customer Experience Focus
Insurers across the industry are beginning to focus more on agent and customer portal enhancements and seeking to have a better understanding of the customer journeys. This reinvigorated focus can be traced back to the early months of the pandemic where insurers quickly realized the importance of having these capabilities as well as the potential gaps in their digital experiences. While customer experience (CX) initiatives may have already been on the way, the pandemic has rapidly sped up the prioritization of these efforts.
Mitch added the point that insurers need to think holistically when building a digital strategy and that open APIs, data usage, and omni-channel communication capabilities should all be considered when customizing a user experience. Matt remarked on how CX initiatives today mirror the organizational importance and execution success of digital initiatives five years ago.
Join us on October 27th, when we will be speaking with Rick Moran from MassMutual, Rick Vinson of Tokio Marine HCC, and Jason Ennis of MMG, to discuss trends and issues in enterprise architecture. Registration for this event can be found here.
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