Can your tech stack be used for spring cleaning? How to reduce the complexity of IT and API
This post is part of a series sponsored by Actentsync.
Today’s insurance institutions rely on average 5.7 to 11.9 different technology platforms for day-to-day operations, depending on their total revenue. The numbers may be higher for large operators that manage multiple agencies and their downstream producers. While this level of digital innovation represents a positive change in the insurance industry’s ability to deliver modern experiences to consumers and to provide employees with efficient workflows, fostering a stronger technology stack is not without its challenges.
Whenever an insurance organization invests in a new digital solution, it creates greater efficiency for at least one insurance allocation puzzle. When the business starts, it may only have resources to purchase the most important technologies, such as email applications and bookkeeping software. As the business grows, it invests more technology to help manage the increase in customers and employees – human resources systems, customer relationship management (CRM) systems, compliance management solutions, and more.
While these systems undoubtedly create greater efficiency for the business, it is undeniable that the more complex your technology stack becomes, the more efficient it is. In fact, it is not uncommon for operators and agents to find some big problems when they buy more systems.
How does a complex technology stack affect your insurance business?
Poor integration function leads to system dispersion
The more systems you add to the technology stack, the more important the importance of these technologies communicating with each other. But as many as 74% of insurers are still relying on old technology to get their core business capabilities, it is not normal to seamlessly connect existing systems to new systems so they work together in meaningful ways. Older systems use different data formats, protocols, and structures than modern solutions. These differences can lead to significant compatibility issues, making integration more complex and ultimately causing system disruption.
Silo restriction smart, data-driven business decisions
Your distribution channel is filled with data from every downstream partner you work with. Active insurance organizations use this data to intelligently scale, shrink and restructure their distribution channels to address market opportunities and challenges. As a result, data-driven businesses are 23 times more likely to acquire new customers and 19 times more likely to obtain more than average profitability than their data-driven lower profitability. However, data silos are a common symptom of the lack of integration between multiple systems, making it difficult to make informed decisions using producer data. Silos prevents producer data from flowing seamlessly through the system, creating multiple versions of the truth in the record, and making it difficult to decipher where the most accurate information actually lasts.
Scalability issues can boost profit growth
Automatic solutions are a real game-changer for the insurance industry when it comes to sustainable growth. For example, today, with the right distribution channel management solution, any carrier agency and its multiple downstream manufacturers can verify multiple licenses in multiple authority and in multiple states All when the button is clicked. After that, the same process can only be achieved in hours, if not days, manual work. However, not all automation is created equally, and many traditional technologies lack the ability to scale effectively, so it is difficult to grow without increasing overhead.
Disconnected systems increase security and compliance risks
Complex and ever-changing regulatory requirements form the backbone of the insurance industry (seriously, we have an entire series), making compliance increasingly complex. Complying with regulations and avoiding fines is particularly challenging when you deal with disconnected systems that cannot be updated in real time when it comes to systems that cause inconsistencies in distribution network data. In addition to compliance risks, data security is a major issue for enterprises with complex technical infrastructure. SecurityScorecard found in a study examining the status of cybersecurity across the insurance sector that third-party software and its vulnerabilities should be half Amid data breaches reported by 150 top insurance companies.
Budget forecasts show more focus on reducing its complexity
Between the pitfalls of complex technology stacks and ongoing market volatility and budget tightening over the past few years, experts may surprise predict Increase Next year’s technology spending will be in the insurance industry as a whole. But, take a deeper look at where businesses plan to use these funds and how to draw clearer images.
With talks of tech consolidation from big-name players like GEICO, and greater pressure on IT departments to deliver faster ROI, it’s likely we’ll see less prioritization on multi-year, complex technical overhauls and greater investment in lower-lift, modular solutions to help consolidate fragmented infrastructure, reduce vendor management complexities, simplify workflows, and unlock deeper data analytic capabilities.
The shift in focus makes even more sense when you consider the fact that many insurers and agents have invested decades and millions of dollars into their existing systems. When it comes to their case, these people are not looking to reinvent the wheel, but they are looking for complementary solutions that will increase efficiency with as few business disruptions as possible.
Solution: Invest in APIs to reduce technical complexity and improve operational efficiency
For enterprises with an existing distribution channel management ecosystem, the Application Programming Interface (API) provides a solution that improves operational efficiency without tearing and replacing the current system. Like the large and complex systems that manage your insurance distribution channels, modern large systems can take months or years. APIs reduce the complexity of the technology and obtain the most complete, latest producer data faster and more efficiently than ever before. Operators and institutions that invest in APIs benefit from them:
Improved integration features: The API is directly integrated into the organization’s existing platform, opening the door to more seamless data exchange between different systems and eliminating bottlenecks in daily workflows.
Seamless, secure scalability: By leveraging APIs that get data from industry sources, businesses can focus less time and resources on data maintenance as their business grows, and more to leverage the technology infrastructure that drives their core business processes.
Real-time data: APIs can improve the quality of distribution network data by synchronizing the existing technology of an organization (and the data that lives in it) with the industry’s sources of truth. Instead of relying on manual data verification, the API automatically ensures that producer data is always up-to-date and useful.
By leveraging APIs, insurers and agents can transform their technology infrastructure from complex, decentralized and inefficient to agile, connected and modern. As a result, they will avoid spending time and money on a comprehensive system overhaul and gain greater visibility on their existing platforms.
Let Apsentsync’s Producersync API meet you where you are
If technical complexity prevents critical distributed channel data from flowing through existing systems, your data doesn’t make you do much. Play key producer data from when and where (think about it) forward Constraint policies or pay commissions) to highly complex analytics to optimize distribution channels for maximum success, producer synchronization APIs can improve your business needs at the cost and implementation schedule required.
Contact one of today’s experts to learn how your organization can benefit from the Producersync API.
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