A new term is generating a stir in the realm of insurance technology and that is SaaS, also known as Software as a Service. To illustrate, below are 10 facts as to why SaaS is buzzworthy for insurance companies and their risk management systems.
SaaS is web-based
Companies who choose SaaS can run their systems without purchasing expensive hardware and software. The only equipment needed is an internet connection and a device (or devices) to access it.
SaaS is cost-effective
These systems operate similarly to a subscription in which vendors are paid a fee for the service. These fees are set forth and payable according to the terms of a contractual agreement.
SaaS has been around for a while
The concept has been around for a few decades. In fact, the idea of a system in which resources are shared date back to the early 1960’s. Companies such as Salesforce began promoting a model for business applications through a web-based subscription service in the 1990’s.
SaaS can be customized
As SaaS has grown in popularity, it has emerged from a “one size fits all” format to one that can be tweaked to conform with special needs that many smaller businesses may have. This is a huge advantage in insurance technology as smaller insurance companies have varying factors to consider in their risk management systems processes.
Data ownership is maintained
Many SaaS contracts are prewritten to include language guaranteeing client ownership of data as well as provisions for what happens to the data in the event the provider goes out of business.
As with any system that holds personal and private information, data security is a concern. Fortunately, most SaaS providers are better able to invest in security systems than smaller insurance companies.
Most contracts provide for contingencies such as the vendor going out of business and set forth how the data will be handled in the event of business closure.
Operating system compatibility
Most SaaS systems are compatible with Windows or Linux and have recently included some compatibility with Mac products.
Internet connectivity issues
The online function of SaaS is only as good as a company’s internet connection. Insufficient bandwidth can result in downtime. However, many SaaS providers include an offline function with their products, allowing insurers to continue to work until such time as the connection is restored.
Advanced opportunities at minimal cost
By eliminating the need for experienced technical staff to run and maintain expensive on-premise hardware and software, companies using SaaS can channel more capital into activities directly related to growing their business.