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Spend or Save? The Top Five Technologies to Transform an Insurance Broking Business

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According to recent research by Redcentric, 68% of mid-sized professional services businesses are planning to invest in new technology this year. But with low interest rates set to continue and tough, ongoing regulatory demands also taking their toll, will there be many insurance brokers among this figure?

Despite the insurance industry’s reputation for taking a careful approach, I predict the percentage will be high. Most brokers recognise that they only way they can differentiate themselves is to offer the best possible customer experience and this demands a seamless and informed multi-channel service. However, most legacy systems are not fit for this purpose, so companies must bite the bullet and invest in new technology.

This leaves two key questions. First, where will the money come from when, typically 70% of IT budget goes on day-to-day maintenance – or ‘keeping the lights on’? The last few years of mergers and acquisitions hasn’t helped in this respect, with many companies battling with a mismatch of systems and siloed information.

Second, with so many new technologies on the market how do brokers decide what to choose to help the business move forward?

As one commentator puts it (CSC in Save a Pound to Spend a Pound, Spring 2015): “Insurers have to strike a balance between what they spend on the technology that runs their day-to-day business and what they spend on technology that will change their organisation for the better.”

In other words, with technology now playing such a huge role in shaping business strategy, the focus should be on moving the business forward rather than mundane tasks such as dealing with patches and licences. Managed IT services providers can help on both counts offering fast-track implementation and accelerated wins, but also freeing up IT teams from day-to-day tasks. They can solve the spend/save dilemma by offering an opex payment model.

As for choosing which new product or service to invest in, here my ‘top five’ technologies for making a positive impact on a broking business:

  • Infrastructure as a Service (IaaS). A chance to streamline and refresh legacy systems. The elasticity and speed of provisioning will appeal to brokers keen to improve agility and response. It’s an opportunity to divest low-value ‘housekeeping’ and focus on higher value customer-facing projects.
  • Hosted desktop (Virtual Desktop Infrastructure). Extends the as-a-service model to the desktop, freeing up more money, time and resource to be allocated elsewhere. For the broker looking to sweat existing assets, hosted desktop makes a compelling case.
  • Database as a Service (DBaaS). Brokers are choosing this as the foundation for compliance (especially Solvency II) and, increasingly, for data analysis without having to employ expensive data scientists in house.
  • Call centre telephony and call recording. A customer-centric focus demands the latest answering and routing functionality, deployment flexibility, burstable capacity and reporting capability. Call recording for greater transparency completes the list. Buying this as a managed service is an affordable, resilient, scalable and highly configurable route.
  • Unified Communications. The convergence of multiple technologies in a single solution is a no-brainer. It unifies email, SMS, instant messaging and group chat voice and video conferencing into one single solution to increase productivity, facilitate fast and efficient collaboration and streamline business processes.

It’s by no means an all or nothing list. Any one of these will bring significant, positive change – a combination could transform the business. Plus, not only will return on investment be rapid, the new agility these technologies offer will help prepare the business for the years ahead.

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