The insurance sector has been strongly affected by the Covid19 pandemic; according to the lloyd’s of London reinsurance group, there will be a turnover increase of €21bn in 2021. However, the pandemic has not accelerated the process of technological transformation, although it has highlighted the problem more clearly. According to the latest study by Insurtech Global Outlook, the progression of companies in the Insurtech sector (understood as a set of companies offering online insurance services, and with a strong degree of digitalization) is marching at an increasing rate, in the face of an insurance sector, traditionally understood, that struggles to adapt. In 2019 alone, insurtech companies invested 6.3 billion euros in technology, an increase of 50% compared to the previous two years. Most of the investments were made within the cloud infrastructure. In more general terms, insurance companies do not hold up to the growth of insurtech startups, where they invest giants such as Amazon, Alibaba, Google.
The main problem facing the industry is the management of its legacy systems, which create waterproof silos, with the result that the flow of information between departments slows down. While insurance companies still don’t accelerate in efficiency by spending 15% more on IT than other industries; in times of pandemic, they also face the challenges of teleworking and a total revolution in work organisation, in addition to the atavistic gaps in the sector. The use of technologies such as low code platforms, however, allow insurance companies to be leaner, more efficient, and better cope with areas such as reducing policy costs, claims (grown exponentially with Covid 19), and improving the customer experience.
Let’s now analyze in detail the advantages that a low code technology can bring to an insurance company:
- Time-to-market acceleration: companies can develop new insurance products much faster and above all easily configure new organizational models, closely linked and functional to subscriptions and compensations.
- Ensuring compliance: a low code platform gives a global view of processes and data, thus ensuring a linear flow of information between various teams, such as agents, back-end, legal office etc. In addition, it allows for a rapid adaptation of compliance procedures: it should not be forgotten that the insurance sector, like the banking sector, is highly regulated.
- Complete and/or improve the customer journey: low code technology eliminates gaps and disconnections between data and organizational processes, making the customer journey consistent and complete, from the analysis of needs, up to the management of compensation, passing from quotations until the subscription and payment of policies.
Ultimately, the adoption of lowcode platforms will be strategic for insurance companies, as it will allow on the one hand to reject the competitive pressure of competitors operating only online (insurtech), on the other hand to reduce costs, be more efficient, customer-oriented, without failing to comply with the compliance obligations of the sector.