Life Insurance

3 Barriers to Adopting Cloud-Native Insurtech and 5 Best Practices to Ease the Transition

This post is part of a series sponsored by AgentSync.

Nothing good comes easy, right? Turns out, overhauling your outdated technology in favor of more modern, cloud-native systems is no exception.

In today’s digital age, shying away from cloud-native technology puts businesses at risk of falling behind. Flexibility, scalability, reduced costs, and an enhanced customer experience are only a few of the benefits cloud-native software can bring to insurance businesses and their consumers. But, no matter how much positive impact cloud-native insurtech can have on an insurance organization’s daily operations, switching from legacy systems to modern solutions is rarely easy, and anyone trying to make the transition might find themselves running into a few bumps along the way.

3 barriers to adopting cloud-native insurtech

As with any major technological overhaul (and especially in an industry as longstanding as insurance), many of the challenges of adopting cloud-native insurance technology stem from the organizational and cultural changes necessary for such a large transition. Put simply, change is hard, and one or more of the following areas might slow you down.

Your current systems

Replacing legacy systems that have been in place for years is much easier said than done. Some insurance organizations’ processes are so heavily rooted in their existing technology that making the transition would cause enough disruption to shut down operations in the short term. When the workflow and productivity impact required to overhaul their entire tech stack feels like too high of a hurdle, businesses will continue to rely on outdated technology, spreadsheets, and other manual processes for daily operations.

Choosing to move only some systems to the cloud might seem like a more viable option. But, doing so can leave businesses with even more challenges as they struggle to integrate the new software into their existing platforms, which likely weren’t built with smooth integrations in mind.

Your people

Switching to cloud-native software is more than just a technological change. It’s also a pretty significant cultural change, and one that can be difficult for individuals working in an industry that, until recently, has remained relatively resistant to change. For many, the current systems, no matter how inefficient, are so intricately tied to daily operations that they’ve shaped the company’s culture.

Getting users to adopt a new way of doing things can require a company-wide shift in thinking. And don’t forget that, on top of helping your team understand the value of the transition, you’ll need to provide the support and training necessary for users to reap the full benefits of the new cloud-native technology.

Your budget

No matter how certain you are that cloud-native software will positively impact your bottom line in the long run, getting past the upfront costs of purchase and implementation can be a significant challenge. The fact of the matter is, while the initial cost might seem like too high a barrier to overcome, it’s typically nothing compared to the cost of business as usual.

Not only does going into technical debt eventually cost you more than what you’d spend modernizing your tech stack, it also wastes employee time, opens you up to unnecessary compliance risks, and stunts your organization’s growth.

5 best practices for adopting cloud-native insurtech

While the barriers for adopting cloud-native technology at your insurance organization may be strong, they aren’t impenetrable. Here are a few things business leaders can do to help set themselves up for success.

1. Understand the problem you’re trying to solve

There’s a cloud-native solution out there for just about every aspect of an insurance organization’s daily operations, from claims management, to customer relationship management, to email marketing and so on. But just because cloud-native software exists for each of these areas doesn’t necessarily mean a business needs to adopt all of it.

It’s important you understand the problem you are trying to solve before diving into a new solution. What could be worse than investing all your time, money, and resources into implementing a new solution only for the bottlenecks and inefficiencies to persist after the dust settles?

Are you trying to cut down on producer onboarding time? To remove manual workflows from your team’s plate? To improve the overall producer experience? Nailing down the problem (or problems) you’d like to solve with cloud-native technology will help you cut through the noise and focus only on evaluating technology that can actually help you reach your goals.

2. Compare what’s on the market

Not every cloud-native application is the same. The right solution for your business will depend on multiple factors, including your specific needs, budget, and preferred level of control. After you’ve established your main pain points and set future goals, compare that data against what each solution can offer.

Remember, product functionalities are just one piece of the puzzle. You should also consider things like the level of partnership you’ll receive with each vendor, their standards around data security, and how they handle software updates and bug fixes after implementation.

Sidenote, if you just so happen to be in the market for a cloud-native producer management software, we’ve put together a handy buyers guide to help with your evaluations.

3. Get references from current customers of potential solutions

It’s one thing to hear about the benefits of switching to cloud-native insurtech from the tech vendors themselves, but what do insurance businesses who’ve already made the change have to say? Look for references from current customers of potential solutions who were trying to solve similar pain points as you are now. Their success, not only with the product itself but also with implementation and customer support will give you a good idea of what you can actually expect from any given solution.

If you’re curious about the success AgentSync customers have had after implementing our solutions, we invite you to take a gander through our case studies as well as our customer reviews on G2.

4. Prioritize security and compliance credentials

Security and compliance can be either a benefit or a drawback of cloud-native software. While some solutions prioritize security and compliance, others don’t quite meet expectations. But in the data-driven world of insurance, safeguarding sensitive producer and consumer information is essential.

A vendor’s response to industry standards like SOC 2 and NIST can give you a clearer picture of which softwares take data security seriously and which ones might open your organization up to more risk. These days, it’s not even worth considering vendors who demonstrate anything less than a commitment to cybersecurity excellence.

5. Make a plan for training, support, and internal adoption

While a big draw of switching to cloud-native solutions is taking tedious, manual work off your team’s plate, updating your tech stack without offering the necessary employee training and support will likely have the opposite effect.

Employee training is a simple and effective way to enable your team to see the full advantages of a new solution. Without training, you may find people hesitant to use the new software, preferring instead to just revert back to the old, familiar way of doing things. Which would be a serious waste of time for everyone.

If you want a high adoption rate, make a plan for ensuring everyone has a high-level understanding of the value the solution provides and access to training materials and support to fill in any knowledge gaps that could hold them back.

Cloud-native software is paving the way for insurance organizations

With a growing number of insurers planning to adopt cloud-native solutions over the next five years, it’s safe to say cloud-native technology is soon to be the new gold standard for the insurance industry. The sooner an organization migrates to a cloud-native tech stack, the sooner it reaps the benefits and the better prepared it’ll be for future innovation.

If you’re ready to make the switch and future-proof your producer licensing and compliance management processes, AgentSync can help. Reach out today to learn how our cloud-native solution makes managing the entire producer lifecycle more efficient and cost-effective.

Topics
InsurTech
Tech

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