As the business environment continues to change for small and medium-sized insurers, the need to migrate towards better implementation of products and services is ever increasing. One platform that is gaining in use among these types of insurers is Software as a Service or SaaS.
At first glance, it is easy to assume that SaaS is strictly a technology solution, but actually, it reaches beyond the boundary of software for insurance into the fundamental aspects of the insurance business including product development, customer service, and business analytics. And it does all of this without encumbering management with the problems that come with in-house legacy hardware and software systems.
For instance, rather than being limited to applications that legacy software for insurance initiatives, insurance companies can use specialized SaaS offerings either short-term or for longer periods of time for faster development, implementation, and problem resolution. This levels the playing field considerably for the smaller insurance companies because they are no longer on the outskirts of real-time analytical tools or business intelligence applications.
SaaS as software for insurance is often paired with cloud-based technology applications for realizing the full potential of digital technology. For example, some companies are experimenting with varied types of payment models, underwriting systems, and niche marketing through the use of SaaS with the cloud.
SaaS also provides greater flexibility for use across a broad variety of market niches. It is not inhibited by restrictive algorithms or out-of-date models. It can be modified for use across company personnel with access or restrictions as warranted. And, perhaps the most critical advantage of SaaS is the fact that it allows company management to channel capital into growing their business rather than into their IT departments.
Whether used for marketing, data management, customer service, or reporting, SaaS is quickly changing the landscape of smaller insurance company dynamics. As companies reap the benefits of cost-effectiveness along with ease of implementation, some are wondering how long it will take before outdated legacy software systems are completely obsolete and no longer in use.
As small to medium-sized insurance companies migrate to SaaS with greater frequency, realizing the benefits of its greater flexibility and enhanced production capabilities, it is not unreasonable to assert that it will be the industry standard in the not-too-distant future.