By the very nature of their jobs, insurance CIOs have long been forced to contend with the implications of an evolving technology universe. Now, the rate of that change is in many ways redefining their jobs and insurance industry as a whole.
When
“The capabilities of information technology in society at large are changing at an unprecedented rate,” says Matthew Josefowicz, partner and managing director of Novarica, who hosted the event. “This is having tremendous impact on customer expectations, distribution models, underwriting and claims capabilities as well as the IT operating model itself. Against all of this change, insurer IT leaders generally can deploy only modestly increased budgets, which means that the necessity for intelligent strategic planning, careful execution, and innovative approaches to solving business problems has never been more important.”
A companion report Novarica produced, “2011 Meeting Report: Managing Insurance IT in an Era of Accelerated Change,” blends input from the presentations and member discussions with existing Novarica research and insights. In the report, Josefowicz contends that technology has moved from a business tool to an integral element of insurance operations.
“Most elements of underwriting, claims, service, and billing are handled electronically, either direct to the insured, or by systems that support agents or internal staff, which means that IT is the key enabler of the business enterprise,” the report states.
Yet, Josefowicz notes that many of the business processes in an insurance company are hidebound and predicated on antiquated technologies.
“Essentially, the insurance industry was designed based on the constraints of 19th or 20th century information technology, and is now operating in the 21st century where the old rules about the speed and accessibility of information may not have vanished, but they’ve definitely eroded significantly,” the report states. “While there is still significant inertia behind the current organization of the industry, the actual limiting constraints that forced the industry to operate this way have been lifted by the development of information technology.”
Given this and their newly won recognition as business leaders, Josefowicz concludes that it is incumbent on CIOs to reconcile insurance operations to the realities of modern technology.
“Against all of this change, insurer IT leaders generally can deploy only modestly increased budgets, which means that the necessity for intelligent strategic planning, careful execution, and innovative approaches to solving business problems have never been more important,” he writes.
