The next big thing: SMA examines the next-generation technology trends for insurers.
SMA recently released a report: Next Gen Technology Trends. The report listed five important watch points for insurers, according to Deb Smallwood, founder of SMA.
"Part of the message from our report is we're not telling you to drop everything and do these [five] things, but you need to be mindful of them and put some resources on it to experiment and figure out how these technologies can be leveraged into your strategy."
The five watch points as listed by SMA:
* Advanced analytics explosion
* Mobile evolution
* Social Media momentum
* Development revolution
* Cloud/SaaS Maturation
As for analytics, Smallwood believes insurers are dabbling, but she doesn't feel they are making an attempt to take it to the next level.
"When we look at the capabilities across the value chain--marketing, distribution, underwriting, claims--all of them have analytics," she says.
Analytics has the potential for the most immediate impact of all the next generation technologies because the initial steps have already been taken by most insurers.
"Mobile, cloud, social media all need to be worked on and we are at the early stages" says Smallwood. "That's why we used the word 'advanced' with analytics. I'm sure insurers are using predictive analytics and predictive scoring, so let's take it to the next level."
Insurers initially displayed reluctance to use tablets and smartphones, but that hesitancy has disappeared.
"Executives all want iPads and they all want data--not necessarily applications," says Smallwood. "They want their analytics and scorecards on top of these devices. The smartphones really tie in with plug-and-play. It's changing our whole culture and mindset."
One challenge users face with mobile technology is nearly all the devices have different protocols and different technology. Insurers can't afford to have multiple versions of the same application.
"[Insurers] are going to have to figure out how to manage the front end of the desktop and then figure out how to manage it on the back end," says Smallwood. "It's going to require a whole new environment."
Smallwood believes IT development teams will get funding to make mobile technology reach a new level. In addition,
Smallwood is seeing some of the solution providers offer apps like first notice of loss (FNOL) that will allow smaller carriers to adopt the technology.
Insurers are going to have to figure out how to get their institutions more involved in social media, points out Smallwood.
"All the major insurance companies are out there on Facebook, Twitter and LinkedIn," she says. "What they fail to realize is [employees] are putting their interpretation of the brand out there. There could be 100 or 1000 people on LinkedIn that work for a particular carrier and all of them are defining that carrier differently. They have to look at things across the enterprise and figure out their strategy."
Smallwood believes the industry is at the infant stages of embracing social media.
"It's almost like we're going to take a step back in terms of efficiency and effectiveness in the use of all this content," she says. "It won't be until we learn how to manage it and have rules will we gain great efficiencies from it"
For over a decade, IT departments have been studying the possibilities of plug-and-play and service-oriented architecture. During that time, there also has been an evolution of programming languages along with a change in the methodology of development from waterfall to agile.
With all that has come a change in how businesses shop for and consume technology.
"The SOA architecture of plug-and-play can be a reality," says Smallwood. "We just have to change the way we buy things. We have to force our solution providers to build things in more consumable chunks and components."
Smallwood remembers back 20 years when she was working at Liberty Mutual building a policy admin system. She recalls a senior executive held up a copy of TurboTax and said he didn't understand how that product could have every single rule and regulation for the IRS on a simple application while his carrier needed three years to build a policy admin system for 50 states and rates and rules for workers' comp.
"I think we're going to continue to get more pressure from executives when they see how simple things can be," says Smallwood. "We're going to have to change the way we do things."
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|Title Annotation:||The Back Page|
|Author:||Hyle, Robert Regis|
|Date:||Mar 1, 2011|
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