Urgent need for insurers to move beyond legacy systems: Earnix

For insurers to remain competitive and responsive to market demands, they must move beyond legacy systems and leverage new and emerging technologies, yet many still rely on outdated systems, with nearly half of insurers (49%) acknowledging they are behind schedule, according to Earnix’s 2024 Industry Trends Report.

The report highlights that many insurers still operate with outdated, inefficient systems that hinder their modernization efforts, limiting their ability to keep pace with industry changes.

In 2024, 49% of insurers admitted they are behind schedule in their modernization plans, making it challenging to implement transformative technologies, particularly in areas like artificial intelligence (AI), advanced analytics, pricing, rating, and underwriting.

Reliance on legacy systems also presents internal challenges, including compliance issues, collaboration barriers, and slower innovation.

Earnix underscores that embracing new technologies could revolutionise core insurance functions—such as pricing and rating, underwriting, marketing and distribution, claims, and more. As a result, implementing new digital tools and modernising operations can help insurers enhance customer satisfaction and retention, improve combined ratios, drive business growth, and gain a competitive advantage.

The survey also found that many insurers are prioritising AI integration in the near future, with more than two-thirds (70%) planning to deploy AI models that make predictions based on real-time data within the next two years. Currently, fewer than one-third (29%) have AI models in place, with the remaining 1% indicating no plans to use AI at all.

Additionally, the report found that 58% of respondents take longer than five months to implement a rule change, and 21% take longer than seven months.

Moreover, most respondents are focused on regulatory compliance this year—a continuation of a two-year trend—possibly in response to a high number of insurers paying compliance fines. Nearly half (49%) told Earnix that their company had to pay a fine or issue refunds due to errors at some point in the last year.

This website states: The content on this site is sourced from the internet. If there is any infringement, please contact us and we will handle it promptly.