‘Tis the season to look back at 2023 and examine what we can do to make 2024 even better for insurance organizations. This blog is a new year’s nod to people like me who are passionate about the evolutionary impact of insurance technology.

I am proud to work in an industry that empowers insurers to innovate and grow in the digital age, and to address global market trends and changes. I’m gratified to contribute to a sector that Deloitte recently described in their 2024 projections in the insurance industry with words like ‘society’s financial safety net’, ‘greater social good’, ‘mitigating loss’, ‘elevating purpose’ and ‘digital modernization’.

As Chief Strategy Officer of Sapiens, these attributes resonate with me because they dovetail with our mission to make a positive impact on a global scale.

Here are the top seven trends for 2024 in the general insurance sector, from Sapiens’ perspective as an industry leader and trendsetter.

1. The insurance industry’s role as ‘society’s financial safety net’ is growing due to increases in cybercrime, climate change and financial and political instability. Insurers need to take proactive transformation efforts to prevent losses from happening.

More than ever, insurers face a greater emphasis on security provisions by vendors. This is driven by increased risk as well as security audits and regulatory pressures. To meet these challenges head-on, insurers must shift toward proactive transformation efforts that prioritize preventing losses rather than merely reacting to risks. The need for heightened security measures has become paramount. Insurers need robust processes in place to proactively safeguard against potential threats, ensuring the security of customer data. Security monitoring and security operations services are essential in today’s climate. Insurers also need to be more aware of fraudulent impersonators who apply for life insurance under someone else’s name and take proceeds from their policies.

2.  Insurers can achieve even greater social good by embracing the social responsibility of mitigating loss severity and reducing life and non-life protection gaps in global markets.

In many countries there is a significant protection gap, where a large portion of the population lacks access to insurance coverage. Insurers can play a pivotal role in reducing this gap. By offering affordable and accessible insurance products, insurers can mitigate the severity of financial losses from unexpected events. There is a growing demand on government for social welfare, retirement provisions and healthcare, which is unsustainable in many global economies, therefore insurers are stepping up to minimize the gap with premium forgiveness or short-term suspended billing. To support this need, insurance companies must identify new and innovative distribution and product offerings and set aside reserves for payout of emergency losses and claims.  Sapiens CoreSuite platform is enhanced by a machine learning proof-of-concept model using data analytics that assess lapsing policies and propose solutions such as temporarily reducing the premium or the benefits.

3. The shift to a more customer-centric business model will require advanced technology adoption and changes in company culture to help minimize siloed interactions and increase access to customer data.

An innovative digital engagement model is essential because a single customer view is not enough to give customers a better user experience. A digital, customer-centric engagement model needs a modern technology framework to underpin it, and this cannot happen in a silo. Machine learning and AI must be leveraged to provide actionable insights to the customer. When a life insurance customer, for example, needs to make a policy change, the request traditionally must go through several different people, so there needs to be more digital engagement to support that capability, as well as more checks and balances to prevent fraud. Sapiens’ platform has a digital front end and core policy administration system, as well as data intelligence to provide customer-centric strategy and processes. Our digital enablement creates a holistic, 360-degree view across multiple business lines.

4. Insurers are transforming to achieve customer-centricity and elevate purpose. Enterprises need to transform their tech infrastructure, products, services, and business models, to fuel profitability and stay relevant.

To boost loyalty and profitability, insurers need to offer more digital enablement especially for younger demographics who have different expectations of customer experience than older generations. They want a fully transparent, seamless customer journey, just like they have become accustomed to in the convenient world of online commerce. This omni-channel capability and support can only be delivered through advanced technology adoption.

The adoption of Software as a Service (SaaS) not only streamlines the implementation of advanced technologies but also provides insurers with the flexibility and scalability necessary to meet the evolving demands of their tech-savvy clientele. SaaS ensures a cost-effective and easily upgradable technological infrastructure, empowering insurers to stay agile and responsive in the ever-changing digital landscape.

5. Data development and ecosystem partnerships are key ingredients of a sales-centric evolution.

To achieve the efficiency gains needed to move forward into 2024, insurers must integrate the development and enhancement of core digital data and analytics, embedding more analytics into their workflow to increase automation. Sapiens has a specific focus on data enrichment, as much compliant data as permissible, at the lowest possible cost. This provides insurers with the unique opportunity to harness the broader ecosystem and insurtech world, to take advantage of the full capabilities of the APIs we are deploying. Our workshops and user groups offer opportunities for customers to collaborate with each other and share insights. When innovative companies partner together, it expands their offerings, enabling them to scale up, meet greater implementation challenges, and enter new markets.

6. Technologies like generative AI and actionable insights are needed to achieve this level of transformation.

Generative AI is poised to revolutionize the insurance industry. Failing to leverage the transformative potential of this new era of AI could mean slow adopters can no longer compete. Sapiens is collaborating with Microsoft and their customers to identify and develop capabilities that provide value through our solutions. Examples of this include embedding generative AI into our user interfaces to drive a better, more intuitive user experience and achieve operational efficiencies. Machine learning provides actionable insights to agents through Sapiens’ digital channels, and predictive modeling forecasts operational workload. Recently, Sapiens and the Insurance Network (TIN) surveyed senior executives from general insurance organizations in the Lloyd’s and London markets to identify leading GenAI opportunities. The top opportunities cited in the survey were enhanced process efficiency, decision making, customer experience and product development, with the biggest potential impact on document interrogation, pricing and underwriting, claims, onboarding, and marketing and customer communications.

7. What alternative core-system enhancements are available to insurers that consider replacing legacy systems too difficult and costly to undertake?

Sapiens has a proven approach to working with insurers on small- and large-scale legacy transformation. Our platform offers a functionality-rich, integrated-yet-modular solution encompassing core, data, and digital – seamlessly woven into a comprehensive, end-to-end vision. Sapiens’ robust solution manages business logic across the platform, natively deployed in the Microsoft Azure cloud.  Replacing legacy architecture with a modern, core system provides significant benefits, including low-code / no-code to enable rapid implementation. Tools like Sapiens Decision automate migration processes and expedite the extraction and deployment of business rules and pre-defined content.  Our modern API-based integration capabilities facilitate the replacement, and our agile implementation approach enables customers to see value from the new system early on in the process.

Sapiens’ platform is not just a technological upgrade, but a strategic move toward a future-ready, integrated solution.

One thing is certain as we look back to look forward: growth isn’t just seasonal. It’s a constant evolution, especially in the insurance industry. Wishing you a new year filled with growth and discovery.

  • 2024
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  • insurance
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Alex Zukerman

Alex Zukerman Alex Zukerman is Sapiens' Chief Strategy Officer. He rejoined Sapiens in April 2020 with responsibility for formulating overall product, business, and growth strategies. In the past decade, he has fulfilled various management roles at Sapiens, in the areas of product management, product strategy, business development and corporate strategy, with also some time spent at Novidea, a leading Insurtech company, as Chief Revenue Officer. Alex has significant experience in sales, marketing, business development, product management and corporate strategy, with a passion for building growth, developing markets, and propositions, and leading business engagements in complex enterprise software domains, specializing in the insurance and financial services industries.