Insurtech, an exploding trend in recent years, is allowing those in insurance IT to think outside of their typical day-to-day, blocking-and-tackling conversations. We’ve become much more versed in the art of what’s possible. This set of technologies [ranging from AI to IoT] is bringing innovation and disruption to the insurance industry, and it’s an area of aggressive investment in 2017.
For an industry that has largely run on paper-based operations and outdated systems for decades, there are plenty of opportunities for disruption – from the Internet of Things, to the cloud, to driverless vehicles, and beyond. But there are also barriers standing in the way, and I’d wager that a CIO in any industry is facing similar challenges in adopting these new technologies.
As an example of how the conversation in insurance has shifted over time, 10 years ago, all anyone in IT could talk about was the policy administration system. It was a transactional system. Now, IT is leading the conversations about data, the customer, and the technology that can help the business move forward. Technology is not just a transaction anymore. The projects we get to work on, especially those in the areas of IoT, smart homes, and telematics, are exciting, and they are at the leading edge of technology across industries – not just in the insurance space.
Barriers to innovation
Of course, there are two sides to every coin, and although we now get to think outside of our everyday conversations and worldview, the biggest barrier is going to continually be the day-to-day. We still have to maintain and care for the existing systems. We still have bumps in the night and hiccups that draw attention away from the possibilities and become a distraction.
Also, there is very clearly a talent war, which is especially competitive for the skills and technologies we’re exploring. When I have an insurance IT person who is an expert in policy, billing, and claims systems, I know they’re attractive to other insurance companies. In Massachusetts, there are about seven insurance companies that I compete with on talent. But, if I have someone who is a big data or an IoT expert, it significantly expands the competitive playing field. There aren’t just seven other companies that I have to worry about poaching my best employees – there are thousands.
All companies are dealing with these barriers to technology innovation – not just those within the insurance industry. For any CIO, but especially those who have worked in fields with more traditional IT practices, it’s time to identify the barriers standing in the way of what’s now possible with technology. Because disruption will happen whether you are leading the way or lagging behind. In the insurance industry in particular, there’s never been a better time to lead.
Thank you for the article Mr. Brady! It is amazing how technology changes so drastically every year. It is not an easy task to keep up with the future while maintaining the past. Especially with the competition regarding to talent.