Small and medium-sized enterprises (SMEs) operating in the insurance sector often struggle to compete in highly dynamic market environments on the grounds of technology-driven landscape. Lack of skilled in-house tech resources, strict regulatory requirements, and the ever-evolving customer needs pose significant hurdles for these SMEs, resulting in reduced productivity and hindered growth.
Despite such limitations, there is a way forward. Today, insurance software providers offer compelling software solutions that help insurers overcome these challenges and seize new opportunities for growth and expansion. Powered by the latest technologies, these solutions empower insurers to leverage advanced analytics and automation to become more competitive in the market to lower costs while improving policyholder experience. Such innovative insurance solutions are lowering barriers to entry by making it accessible to SMEs that are often cash-strapped or face resource limitations to harness the power and advantages of such differentiators.
However, simply choosing insurance software solutions that ‘fit’ is not an end-all, be-all solution to the problems at hand. SMEs need to back it up with proper implementation and brace for any disruptions.
Common Implementation Mistakes by SMEs and Their Functional Solutions
Here’s a look at some common mistakes SMEs make while introducing insurance software platforms, along with some practical solutions so that your business does not fall prey to them:
1. Lack of Proper Planning
Implementing a new insurance software platform entails more than simply hitting the install button. Diving into the implementation without a comprehensive plan in place is one of the biggest mistakes small and medium-sized insurance businesses can make. A well-defined plan helps ensure that the implementation is catered to the specific business needs. It also enables all the stakeholders to stay on the same page and work collaboratively throughout the process to not lose focus of the ultimate goal. As such, when implementing insurance software solutions, businesses must thoroughly analyze their requirements and pain points, and then develop a suitable implementation plan to achieve the objective.
2. Not Involving End-Users
Typically, when any insurance software solution is being implemented, only the approval of the C-suite along with other decision- makers and influencers is sought. However, the end-users, such as agents and customer service representatives, also have an important role in the software implementation process, specifically with regard to the adoption of such a technology. Failing to involve the end-users of diverse departments during decision-making can lead to the implementation of software that does not meet the business’s operational needs. A study by Forrester Research found that projects involving end-users from the beginning have a 50% higher success rate. Including the end users from various departments such as IT, sales, customer service, etc. ensures that the software caters to the practical aspects of daily operations.
3. Overlooking Scalability and Integration
Small and medium-sized insurance businesses often select software without looking into their scalability and integration capabilities. Such a decision can hinder long-term growth aspects. As their business grows, the software should be able to accommodate the expanding business operations with ease. On the same note, insurers must choose insurance software that seamlessly integrates with other business systems and applications such as CRM, claims management software, etc. to create a long-lasting tech stack. If the systems within the business environment cannot connect with one another, it becomes difficult to consolidate and transfer information across diverse departments.
4. Choosing a One-Size-Fits-All Solution
In the ever-growing landscape of insurance software solutions, off-the-shelf software can seem tempting for small and medium-sized businesses seeking a quick fix. However, customized solutions developed by specialized insurance software providers prove to be a game-changer. Custom insurance software development allows insurers to incorporate features specifically designed for their unique business model. Customized solutions align perfectly with the organizational workflows and reduce manual intervention. SMEs facing budgetary or time constraints can outsource software development or at least customize available white-label solutions to match their specific needs.
Build Custom Insurance Software Tailored to Your Needs
5. Not Setting a Realistic Budget
Insurance software implementations usually cost more than expected – this does not even account for any recurring costs. The initial investment itself can inflate significantly when considered holistically if one thinks of the cost of the solution, the cost of training and onboarding of employees, the losses stemming from the downtime, and so on. As such, due to financial constraints, small and medium-sized insurers often underestimate the budget required for software implementation. To ensure a successful implementation, insurers should set aside a realistic budget and account for various factors while doing so. They should also keep a healthy margin for cost overruns. The cost of the new insurance software platform is merely the beginning factor. As the implementation moves ahead, incremental and maintenance costs add up.
Here are the different types of costs associated with insurance software implementation:
|Additional On-Going Costs
|Security and Compliance
All in all, insurers should conduct a comprehensive cost analysis and set a realistic budget to ensure no financial surprises crop up during the implementation.
6. Neglecting Support and Training
Lack of proper training and support can be counterproductive and lead to poor user adoption. It is essential for businesses, particularly SMEs, to understand the role of adequate training in ensuring a successful software implementation. As such, insurers must invest in comprehensive training programs for their employees and ensure ongoing support to address any issues promptly. Appropriate training empowers employees and teaches them how to maximize the software’s potential.
Apart from user training, access to continuous and reliable support is also equally important. Choose an insurance software development company that nurtures the software implementation after deployment to ensure the business achieves the desired results.
Successful implementation of insurance software solutions is pivotal for small and mid-sized insurers aiming to drive growth and competitiveness. By avoiding the common mistakes discussed in the blog, insurers can pave the way for a successful software implementation. Insurers should approach the implementation as a strategic investment rather than a mere operational upgrade. This allows them to efficiently navigate the digital landscape, gain a competitive advantage, and ensure sustainable growth in the industry. The right insurance software, when implemented correctly, can have a transformative effect throughout the organization, and the information shared above can help you steer clear of the pitfalls.
Case in Focus
A multinational insurance organization with over 15 years of experience in global dealing was grappling with the burden of legacy systems. Managing different business processes on the in-house setup was turning out to be expensive and time-consuming. We helped the insurer migrate to a modern insurance management system for seamless synchronization. As a result, the insurer was able to reduce the technology maintenance cost by 15 percent. For more details, refer to the complete case study.