The Insurance industry plays a large factor in the economy due to the amount of money it collects, the investment behind it and of course the role it plays in covering risks for individuals, companies, property or vehicles.
Cloud computing has transformed many industry sectors with its ease of deployment, resourcefulness, and flexibility, and the insurance industry is no different. The number of people working in the industry has grown over the years and, accordingly, so has their way of doing business. As the industry is expected to grow their IT spend by an annual compound rate of 3% by 2020, it’s clear that cloud computing will be an essential component in that mix.
In fact, cloud computing is not the only trend they are embracing. Their information security had to be strengthened due to the growing amount of data they collect as well as the widespread adoption of bring your own device (BYOD) policies.
The industry acknowledges the significance of cloud computing technology and understands the need to adopt it. Cloud computing is the most efficient way for a company, their customers and the broke’s (also referred to as insurance advisor or insurance manager) to connect and collaborate on the go. The brokers are usually not on the company’s payroll, as a single broker will generally work for more than one company.
Security is bound to be a concern in an industry where money plays a key role. It goes without saying that people working in the insurance sector are not necessarily technology experts and, as a result, cloud service vendors bring with them an expert team along with SLA’s that clearly define their role. This is a huge gain for insurance companies as they never have to worry about storage, up gradation, maintenance or the security of their IT infrastructure.
How does Cloud Computing benefit the Insurance Industry?
Although insurance industries collect huge sum of money each day, they have their expenses laid out too. Some of them include infrastructure, employee wages, electricity, employee training and traveling, etc.
Cloud computing can help save a great amount of money which can be invested in better training programs or better insurance plans. Cloud is known for its flexibility and pay as you go plans, a primary factor that attracts so many businesses.
Unlike traditional in-house IT infrastructure, cloud computing offers rapid deployment allowing businesses to be ready to take advantage of it in short order. Cloud has more than sufficient resources available at its disposal to allow for multiple tenants in the shared environment. These resources are always scalable.
You will never need to manage or maintain your IT resources. This can include upgrading storage and RAM, scaling processing speed, managing equipment, deploying, managing and updating software applications and anti-virus programs.
Although insurance is a steady industry, it is possible to see spikes in business, which generally translates from an IT perspective into a higher demand on resources.
Conversely, it is not always possible to have the same resources readily available in a traditional IT environment. Cloud makes sure that these spikes do not hamper business, allowing you to handle these demand spikes easily and at a low cost.
Optimize Risk Management
Cloud allows you to integrate risk data, risk assessments and risk indicators within its environment which helps you with protecting your data against data breaches and data theft.
Cloud Deployment Models for Insurance
The primary cloud deployment models are public, private, hybrid and community cloud. Although the fundamental concept remains the same, each model has its own purpose. For example, a business will likely not deploy a public cloud model as they may not want to host their data in the public sphere.
In a different cloud setup, an insurance company may not want its claims management data in a public cloud but they may be fine with customer service and support to be hosted there. This is precisely why many industry experts recommend hybrid cloud as an ideal cloud deployment model since it takes advantage of both public and private cloud setups.
IT companies have fairly proactive in creating cloud-based solutions for the insurance industry that benefits the company as well as the customers.
Capgemini developed Insurance Connect, which they describe as a subscription-based service for claims, policy, and billing that helps insurers leverage on-demand, best-in-class pre-configured applications across the entire insurance lifecycle to respond to new market opportunities, gain operational efficiencies and focus on essential business activities, improving customer experience and brand differentiation.
Cloud Insurance is another company that has developed a cloud-based software solution of the same name, which helps in policy and claims management system for insurance agents, brokers, and companies.
You should not be surprised to see more and more IT solutions coming forward in the next few years to create their own platforms and software-based services for the Insurance industry.
Insurance, though open to cloud computing, is still an industry (in comparison to others) that is yet to be consumed by the cloud.
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