5 Key Factors in Selecting a New P&C Insurance System
In a world where technology constantly advances, insurance carriers are racing to compete by seeking new software solutions. Whether ditching outdated systems or streamlining inefficient processes, finding the right insurance platform is crucial. But let’s face it, it’s not always a walk in the park.
Buying new insurance software is a complicated process. The average time for an insurance carrier to decide on a technology vendor typically falls within 3 to 6 months. This timeframe includes vendor evaluation, negotiation, and decision-making processes. However, the timeline can extend beyond 6 months for more complex projects or larger organizations.
Technology performance is critical to business success, and it is a setback if the insurance software you finally decide on doesn’t support your growth plans. This is a more common occurrence than you can imagine. A survey by Ovum, a tech research and advisory firm, says that only 27% of insurers consider that the policy management system implemented was successful.
How to Pinpoint the Insurance Platform to Invest in?
As you begin the search you can easily come across more than 200 different platforms. When faced with such an array of options, how do you decide on the perfect fit for your team? How do you confidently know where to invest?
Here are guidelines that can steer you to the right match.
The First Step: Know the Features You Need
It is crucial to assess your company’s requirements thoroughly. Start by consulting with your team to ensure everyone’s needs are considered. Identify any potential gaps where additional support may be necessary. Recognizing current gaps is crucial for selecting a provider that addresses immediate challenges while also aligning with long-term goals.
Once your business needs are clearly defined, you can research potential solutions. Develop a list of providers that align with what you’re looking for. Look for insurance technology vendors with strong development skills and reputable track records. Additionally, keep your budget in mind when in the process. Their rates should be affordable and transparent, ensuring a smooth and cost-effective partnership.
A Deloitte insight into ERP evaluation criteria is very significant. Finance leaders surveyed said they evaluated software platforms mainly on functionality yet found little difference in the capability fit of the different platforms. This led Deloitte to recommend a shift in focus for software evaluation: architecture should be prioritized by 10 pp, while criteria such as vendor ecosystem, culture, and vendor relationships should increase by 5 pp. Similarly, product strategy and roadmap should also receive more weightage — currently, it does not figure in the evaluation process.
#2 Look for a Full-Cycle Policy Management Solution
While the core functionality across the products in the market is the same, the underlying details of how these features work are what sets each software solution apart. For example, while two software platforms may both offer policy management functionality, the way they handle policy creation, approval processes, and integration with other systems may differ in terms of design, user interface, and technical architecture.
One crucial filter in evaluation is to look for a solution that offers full lifecycle management for your policies and procedures, including creation, review, approval, publication, assessments, compliance reports, and audit trails.
The software platform should provide a centralized repository for policy information, ensuring easy access, accuracy, and data security. With all available relevant data, employees can avoid the hassle of sifting through documents and multiple systems.
Additionally, configurability is crucial, even with white-label solutions. The software should allow customization to match specific business requirements, from tailoring workflows to generating detailed reports.
Moreover, prioritizing platforms with sophisticated automation capabilities can lead to immediate efficiency gains. Some platforms may offer advanced automation capabilities, while others may have more limited automation functionality. It’s essential to carefully assess each platform to determine its level of automation and whether it meets your specific needs and requirements. For instance, allows insurers to decide on the extent of automation based on the Line of Business (LOB). You can choose to either fully automate policy processing or implement a hybrid approach that combines automation with manual processing. SimpleINSPIRE,
#3 Claims Management: A Critical Selection Criterion
When selecting new insurance software, here’s what to consider when evaluating claims management capabilities:
FNOL and Claims Tracking vs Reserve Calculations and Full Workflow Tracking: The depth of functionality in claims solutions varies significantly. Some software offers basic capabilities like First Notice of Loss (FNOL) insertion and generating reports from entered claims data. These functionalities are often bundled with back-office policy administration systems, which may suffice for insurance companies outsourcing claims management services. However, if your company handles claims internally, you’ll likely need more robust features. This includes the ability to track and calculate reserves, capture claim settlement transactions, and manage the entire claims workflow seamlessly.
The SimpleINSPIRE Claims Management platform is equipped to handle Loss Reserves & Payments, DCC Reserves & Payments, AO Reserves & Payments, and various Recoveries at the claim feature level. It offers automated reserving capabilities based on client-provided rules and algorithms.
When evaluating insurance software, ensure it aligns with your organization’s unique claims management needs, whether outsourced or handled in-house. Choosing a solution with comprehensive claims management capabilities will streamline operations and enhance efficiency in handling claims throughout their lifecycle.
Reproduced with Permission from: https://www.simplesolve.com/blog/5-tips-choosing-insurance-software. Read the other tips here.
Originally published at https://www.simplesolve.com.
