Sapiens International Corporation an insurance business solutions provider, announced results of its survey of U.S.-based senior insurance executives conducted during the annual ISOTECH 2002 conference last month in Orlando, Fla.
The survey uncovered concerns with current capacity and cost efficiency of existing information technology systems.
Asking respondents to identify their anticipated top IT challenges over the next three years, a quarter (26 percent) ranked “modernizing key business processes” as the most pressing concern facing the industry, 20 percent identified “IT budget constraints” as their greatest concern. The issues ranked as the “main concern” for the industry were:
*Modernization – 26 percent;
*IT Budget Constraints – 20 percent;
*Developing or Acquiring Core Applications – 11 percent;
*Architecture (Business and IT) – 12 percent;
*Integrating New and Legacy Systems- 13 percent.
The top technology-related issue facing the industry expressed in the survey was “legacy policy administration systems” with 29 percent of respondents ranking it as the top challenge. Other issues revealed include:
*Legacy Policy Administration Systems – 29 percent;
*Agent/Broker Internet Transactions -13 percent;
*Regulatory Compliance – 13 percent;
*Agent/Broker Internet Information – 11 percent;
*Implementing Standards – 10 percent;
*Enhancing Claims – 5 percent.
The survey also identified that 30 percent of policy administration systems and one-quarter of claims and billing/commissions systems are more than 10 years old.
A significant increase is expected in the use of the Internet to communicate between carrier and agent, according to the survey. While less than a third (31 percent) of insurance executives currently use the Internet for over half of their communication, 77 percent anticipate to be at this level within two years.
“The results reflect a very real concern in the insurance industry about IT budgetary constraints in a rapidly changing technology landscape,” Judy Johnson, vice president of Insurance Strategy, Sapiens Americas, said. “Interestingly, few respondents cited fast ROI or systems costs as a project concern, which underlines the continuing IT/business credibility disconnect and current focus on short-term, tactical initiatives as well as the disillusionment with current packaged offerings, seen as expensive, incomplete and inflexible.”
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