Insurance on the Cloud
If one were to ask an Insurance sector CEO what keeps him/her awake at night the range of responses may be limited to a handful! Some might talk of the cost of customer acquisition while managing the lifetime value of a customer may interest another. Managing the ‘customer relationship’ paradigm and driving the business engine in terms of sales and marketing may interest a few others. But a critical issue with most insurance sector leaders would be focused on making the ‘back end work. The Cloud holds immense potential as a solution backdrop for almost every key industry issue. Cloud technologies, by definition, must allow residing IT systems to help the business respond better to business needs at manageable cost levels, and that includes the creation of new services and servicing newer markets.
For many industries, insurance included, the increasing importance of cloud computing derives from its fit with current business priorities: it provides the capabilities businesses need on a flexible basis, helping companies respond quickly and cost-effectively to changing conditions either through a public or a private cloud. By combining virtualization and multi-tenant architectures with a pay-as-you go business model, cloud computing represents a new model that will significantly impact the way IT infrastructure, platform, application and business process capabilities are procured, supported and delivered.
One of the key benefits of cloud computing in insurance involves driving customer centricity through data unification. This can have a positive impact on costs as well. It allows new products and services reach the market faster, and allows for better customer service and management. Add to this the impact on renewals and unification with external systems and the argument for the Cloud in insurance is pretty much complete.
The Cloud ecosystem in Insurance calls for and enables a seamless system from underwriting to claims and back office processes. The Cloud also enables applications at their moment of maximum impact at the most opportune timing. Analytics on the cloud enables and drives stronger customer orientation.
The adoption of new technologies and enablers usually opens up a Pandora’s Box of challenges but in this case 3 key issues need to be kept in mind –
- Understanding the customer satisfaction model and the intertwining IT network and infrastructure
- Clear standards of delivery and the IT interface processes
- Managing investment levels, driven by a frequent review against vision and expectations
What makes cloud computing a growing reality for today’s businesses is the pervasiveness of the Internet and Internet technologies, combined with advances in virtualization, hardware commoditization, standardization, and open source software.Of course, the choice between private and public clouds represents a trade-off between customized security standards (based on industry’s regulatory requirements) and flexibility.
CIO’s are evaluating 2 distinct areasas they evaluate cloud technologies in Insurance. The first is the solution itself—secure, reliable access to all the features and promised functionality. The second is more like an ‘insurance cover’ in itself, to protect themselves if something thing goes awry.
Will the permeation of cloud technologies galvanise the insurance sector towards better product delivery, managing the value chains and lower costs? Or will CIO’s remain obsessedwith “self-insurance,” on the data security front?
Karan represents a new generation of Product Marketing Managers that can cover core product development & management activities as well as product marketing activities. To his customers & colleagues, he is the Go-to-guy for consultations.