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6 Ways Migrating to the Cloud Can Help Your Insurance Company

May 5, 2022 No Comments

Featured article by Alex Williams

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Now that Software as a Service (SaaS) offers have fully matured, we’re seeing more and more businesses move their core system components to the cloud. While insurance businesses were a notable holdout to the SaaS trend, today we’re seeing insurance businesses migrate their data to the cloud in droves.

Many of the challenges previously experienced by providers have been addressed by SaaS developers , so much so that presently, having one’s health insurance solution on the cloud offers some very serious benefits. Here are 6 ways migrating your system to the cloud might help your insurance company:

1.) Easier Claims Processing

Migrating a self-hosted system to the cloud enables a significant efficiency boost. Processing claims and adjudication will no longer require customers and agents to be at specific physical locations. Resolving and cross-referencing insurance data gathered from different sources can also be much easier compared with traditional onsite solutions, as cloud solutions make it easier to have a “single source of truth” for any piece of information.

Taken together, these resolve many of the customer experience roadblocks that once characterized the typical claims processing experience. In an industry as competitive as insurance, this potential customer service improvement can become key in the insurer’s client retention and retargeting projects.

2.) Integration with Financial and Insurance Partner Systems

Cloud-based systems tend to be easier to integrate with other systems, particularly if all the solutions were developed by the same vendor. While this wider systems integration is useful for all business models, insurers stand to reap significant benefits from closer integration with their financial systems as well as those of their partners.

Compared to traditional onsite setups, data in cloud-based systems is far less segregated. Insurance companies that move to the cloud can more easily configure their systems to automatically draw information from their finance management systems as well as those of their partner institutions. This dramatically speeds up different processes that would otherwise require hours of painstaking manual data reconciliation.

Efficiency is not the only benefit of better systems integration. Being able to integrate information in this way also reduces the risk of errors as well as the possibility of fraudulent activity. This reduction in risk frees up insurers to effectively serve more products to a wider customer base.

3.) Better Data Security

Insurers handle a lot of sensitive information, making data security a high priority for these institutions. Because bad actors are constantly developing ways to access this data, data security is an ongoing project that requires well-trained teams of financial IT experts to execute successfully.

Bad actors are not the only threat, either. The hardware that hosts this data has to be maintained properly and kept safe from natural disasters and other unexpected events that may result in data loss. These activities then become ever more complex the larger the institution grows.

Going with a reputable SaaS service helps insurers avoid many of these pitfalls. Not only will their data be backed up and handled by highly specialized teams of IT experts, but it will also enjoy multiple redundancies that render it immune to any localized data loss events.

4.) Near-Infinite Scalability

Going with a cloud-based health insurance solution enables insurers to grow or downsize as much as they need to without needing to consider hardware, staffing, or real estate investments. All the institution has to do is to choose a subscription plan that works for their needs and they receive guaranteed levels of service. In practical terms, this empowers smaller insurance businesses to match the reach and capabilities of larger institutions in a meaningful way.

5.) Maximized System Availability

It’s not unusual for traditional self-hosted systems to have problems with reliability. This has less to do with the technology involved and more with the focus of different institutions. Internal IT teams at insurance businesses may have to juggle dozens of responsibilities at any given time. Reputable SaaS businesses are just much more focused and can scale their operations efficiently as a result.

In practical terms, this means that cloud-hosted systems tend to be more reliable, less prone to long outages, and offer a better overall user experience. This directly translates into happier customers, fewer maintenance problems, and more consistent revenue streams.

6.) Improved Legal and Standards Compliance

Using an SaaS solution for insurance can simplify compliance with various legal requirements and international standards, resulting in reduced risk and operational benefits.

While meeting compliance is something that could be done on self-hosted systems, customizing the system can often be a complex and risky operation that requires months of planning. Doing the customization needed to meet these new requirements may also require long downtimes for implementation and testing, losing money for the business in the process. With so many new legal and standards requirements coming up ever so often, these service gaps can be a major cause of customer dissatisfaction.

Because cloud-based insurance solutions are maintained by specialized third parties, most of the headaches associated with back-end compliance are easily dealt with. This reduces the insurer’s exposure to legal risks and allows them to more easily meet different international standards.

Is a Cloud-Based Health Insurance Solution for You?

While there may still be niche applications for onsite health insurance solutions, cloud-based systems have many more advantages going for them. The cost savings, efficiency bonuses, agility, and the reduction of risk enabled by these remote systems give smaller insurance businesses a real advantage in the crowded insurance market. All things considered, insurers who haven’t yet migrated should, at the very least, consider the cloud’s limitless possibilities.

CLOUD DATA, SOCIAL BUSINESS

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