Even as “new economy” hype is receding into memory, insurance companies are finally hitting their stride in finding practical uses for Internet technologies, according to a recent “Emerging Strategies in Insurance & Technology'” survey sponsored by IVANS Inc. Executive level IT professionals at 80 insurers took part in the August 2001 survey of how their companies use technology.
Respondents agreed that the insurance industry had initially been slow in embracing the Internet to improve overall efficiencies. Almost 56 percent felt that the industry ranked behind stock brokerage, banking and real estate in this regard.
“The survey showed that most insurance companies take a ‘practical’ approach to technology,” said Clare DeNicola, IVANS vice president-sales. “About 78 percent use a technology to fill specific business needs, while less than 6 percent use it aggressively, vying for a competitive advantage.”
Even so, the survey shows that the Internet is now coming into its own in the insurance industry.
Almost 70 percent now have websites aimed at helping agents find the information they need, and although only about 15 percent of respondents are currently using the Internet as a distribution channel for insurance sales, over 75 percent consider their website a sales vehicle for selling policies.
Only 8.1 percent of those responding said they had no plans to replace legacy systems; 30.2 percent were rewriting their systems to be web-based, and 53.5 percent were implementing web-based front ends for existing systems. Another 7 percent either had already rewritten everything to be web-based, or had no legacy systems.
In addition, 48.8 percent have implemented a Virtual Private Network (VPN) to communicate with remote employees, and another 31.4 percent plan on implementing one in the next 6-12 months. VPNs allow users to access the Internet securely; 82.6 percent of respondents considered themselves “Very security conscious,” utilizing firewalls, passwords that change, and tightly enforced security policies to protect their data.
“Insurance may have lagged behind other industries in adopting the Internet, but now it’s making up for lost time,” DeNicola said. “What we’ve learned from the mistakes of others will help us to avoid some pitfalls and blind alleys. The Internet offers the industry an array of new tools that will help to make the carrier-agent relationship more efficient than ever.”
IVANS Inc., headquartered in Greenwich, Connecticut was formed in 1983 by 21 insurance companies to provide data networking and e-commerce solutions and services to all participants in the insurance industry. It serves over 475 insurance and healthcare organizations and more than 30,000 independent agents and brokers.
Complete results of the Emerging Strategies in Insurance & Technology survey and prior IVANS industry surveys are available on the IVANS website at: http://www.ivans.com/surveys.asp.
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