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Resetting your core insurance platform to enable flexibility with the power of cloud

Tin Triet Huynh
30 June 2023

The biggest competitive advantage over other insurers? Flexibility.

We define Flexibility of an application as “readily capable to adapt to new, different, or changing requirements.” In a world that is rapidly changing, it’s the key competitive advantage to seize opportunities and overcome challenges. For an organization to be nimble and agile, its technology must be Flexible. Moving core insurance platforms to the cloud can help, and Guidewire Cloud does just that.

The criticality of flexibility

Business is changing, and the insurance industry is not immune to that change. Market dynamics are driving those changes:

  • Pressure on profitable growth while overcoming climate change, inflation, increasing supply chain costs, geopolitics, and the aftereffects of the pandemic
  • A volatile regulatory landscape around financial solvency requirements, cyber security, data privacy, artificial intelligence, climate change, and consumer protection
  • Evolving customer expectations around personalization, human empathy, self-service capabilities, and enhanced digital and omnichannel experiences
  • Increased competition and disruption from insurance startups, tech companies, non-insurance competitors, and embedded distribution models

With flexibility in their underlying architecture, insurers can adapt to change. New data sources may emerge to assess and price risk better, to make more informed underwriting decisions, and to increase automation across both underwriting and claims processing. New partnerships may develop where integration of applications, solutions, and technology needs to occur quickly, to add business value through additional capabilities.

Resetting your digital core to enable flexibility

Modernized self-managed core systems are often significant upgrades on legacy systems. However, their inherent architecture coupled with how insurers implemented them inhibits flexibility. Insurers typically implement an on-premises core system that is saddled with customization with limited thought around experience, digital capabilities, data capabilities, and process efficiency. The architecture itself is not nimble enough to add integrations and new functionality at speed and scale. So, how can insurers reset their path to value realization?

The best solution is to work alongside an experienced transformation partner who is able to give the strategic insight necessary to leverage cloud to get the flexibility that legacy and self-managed systems lack. This gives insurers a seamless transformation while receiving the best industry advice available. Consulting with expert opinion also builds collaboration in the market. When considering this transformation, it’s vital to ensure you have the right strategy in place first.

Cloud architecture has several key advantages: scalability, speed to market, and extensibility. It is the latter quality that enables and unlocks business value—the ability to add new capabilities through development on the cloud, regular updates from the software provider, and an ecosystem of strategic partners. The self-managed solution simply doesn’t have the same extensibility as a cloud-architected solution does.

The value proposition of Guidewire Cloud—recentering your transformation

Consequently, the shift to cloud-native services is no longer a question of IF, it’s a question of WHEN. Moving to a service like Guidewire Cloud will enable organizations to invest in differentiating capabilities that add business value instead of putting dollars into the core transactional systems. Guidewire has made massive investments in Guidewire Cloud and continues to push new features around content, application, and infrastructure multiple times a year. These features power a modern, reliable digital core so insurers can focus on capabilities that deliver engaging, efficient, and easy experiences to grow their business.

It’s an often-overused term, but Guidewire Cloud “future-proofs” your core system. It sets the foundation for you to enable future capabilities and answers the following questions:

  • How might you enable a leading customer and employee experience?
  • How might you reduce underwriting and claims cycle times?
  • How might you enable next generation data and insights?
  • How might you enable digital capabilities?
  • How might you enable an ecosystem?

The way to maximize investment in a cloud service such as Guidewire Cloud is to leverage an experienced partner with not only the skills needed to implement core systems but also the experience in implementing cloud-based platforms using a SaaS model. Capgemini can uniquely transition insurers to Guidewire Cloud and optimize the core platform, all while providing the transformation architecture to ensure customers reach their transformational aspirations. By transitioning to Guidewire Cloud and externalizing custom functionality outside of insurance core systems, insurers will reduce complexity, limit the cost to run their transactional systems, and enable the extensibility needed to remain flexible. Capgemini, with flexibility powered by Guidewire Cloud, can equip insurers with the ability to adapt to change, quickly and nimbly, without the stress of losing focus on other priorities.

Author

Tin Triet Huynh

Senior Director, Insurance, Capgemini

Andrew Hood

Global Insurance Practice Head