Making Sense of P&C System Modernization

Chris Daniels: Hello and welcome to the Sapiens Insurance 360 podcast. I’m Chris Daniel, Director of Solution Consulting here at Sapiens and your host for today’s episode. Today, we’re tackling a question every carrier is asking: what does modernization really mean across today’s property and casualty market? To me, it’s not just about replacing old systems. It’s about building flexible platforms that connect digital data and core operations that can evolve with the business. And despite all the buzz around AI and digital transformation, research shows that core modernization still accounts for nearly half of insurers’ IT budgets. In 2025. And to help me make sense of it all, I’m joined by my colleague, Laurie Von Dauber, a standout solutions engineer here at Sapiens who brings real-world experience helping carriers rethink policy billing and operational strategy.

Laurie, welcome to the show!

Laurie Von Dauber:Thanks, Chris. I’m really excited to be part of this conversation. Modernization is about more than new technology. It’s really about using technology the right way to drive real business results. In my role here at Sapiens, I work closely with carriers of all sizes, helping them shape their modernization roadmaps to deliver that faster, smarter service and stay competitive in a market that’s moving faster every day.And while trends like AI and digital are changing fast, it still all depends on the strength of the core. The better a policy billing and claims system is, I think the more effective digital data and automation efforts will be. So, Chris, with your background in claims transformation and with my focus on policy and billing, let’s share today what we’re seeing for how leading carriers are navigating this next phase of modernization.

Chris Daniels: Okay. So let’s get things started. We know carriers are modernizing to solve real business challenges in not just upgrading their technology. So, Laurie, when you’re talking with carriers, what are they really trying to accomplish with their tech investments?

Laurie Von Dauber:That’s a great question, Chris. So when I work with clients of all sizes and tiers, and they’re writing commercial, they’re writing specialty as well as personal lines. And when I respond to RFPs and I’m prepping for demos of Sapiens solutions, my focus is on what the carrier strategy is. So I’m always asking myself those questions. What’s driving their motivation? What are they aiming to solve and how can our solution help? So that my presentations, my response is in an RFP are focused on the business outcomes they want to achieve. And we’re seeing that focus reflected more broadly across the industry, too. So recent analysts surveys show that midsize P&C carriers, especially those midsize carriers, they’re stepping up their IT investments this year, really prioritizing modernization to drive those outcomes. I also see that importance of fast, automated turnaround time and decision handling, which requires data insights, risk assessment, as well as capacity, all achieved by an insurance platform like Sapiens, which delivers that end-to-end intelligent business solutions by integrating the core capabilities with data analytics and AI. And finally, as I think about this, insurers look to modernize their business to stay competitive with newer insurer tech companies entering the market. That’s where a SaaS solution allows a carrier to stay on top of advances in technology as they emerge. Cloud systems offer that greater agility, making it easier to deploy updates, launch new products, and respond to market changes. Sapiens has partnered with Microsoft to enhance capabilities and performance of insurance companies through cutting-edge technologies and cloud-based solutions.

Chris Daniels:All good points, Laurie. So when I think about modernization strategies, a lot of it is focused inward, as you’ve been talking about streamlining operations, improving decision making, gaining agility. But today, speed is the name of the game, right? And a lot of that pressure is coming from outside the organization. How do you think external entities are shaping how carriers think about modernization?

Laurie Von Dauber:Yeah, I’d agree that another key factor in modernization and growing up the business is that investment in technology for the improved customer engagement as well as the customer experience piece, right? Digital portals, they’re convenient, they’re personalized, and in some cases, they’re allowing the customers to quote, bind, and even manage those policies online. That’s all in turn, automating underwriting, shifting underwriters toward the more complex, value-driven cases that digital self-service, in fact, it has become one of the top capabilities carriers are prioritizing this year for 2025, according to some recent industry insights. And especially among those midsize insurers aiming to strengthen their customer loyalty.

Chris Daniels: Yeah, I completely agree. And I’ve seen firsthand, you know, how important the digital experience is, especially across the claims space. You know, someone dealing with a loss, they’re not thinking about systems. They just want a simple way to check on their claims status, to submit a document, maybe, or to send a quick message to their claim drop. And I think most people, if they’re like me they would rather do that in a matter of seconds than wait on hold for someone or to navigate a frustrating phone menu or a voice response system. Yeah, I think providing them that kind of access through a digital portal or a mobile app, it has a huge impact on satisfaction and trust. And that brings us to the next part of our conversation, okay? So if modernization is the why about what’s driving this, then core systems [are] the how. So Laurie, what are carriers today looking for exactly in a modern core system?

Laurie Von Dauber:Carriers are looking for flexibility. They’re looking for user experience and integration with emerging technologies. So according to the latest research, core system transformations remain a pivotal priority for P&C insurers. In fact, this investment is still making up about half of insurers’ IT budgets. So when I think about what carriers are looking for, what comes to mind is a strategic platform. A strategic platform offers a strong partner ecosystem which gives carriers access to plug and play of insurtech data providers. AI, and digital tools. The challenge they have today is a lack of that flexibility and support for emerging technologies like your GenAI, which offers the document summarization and the interaction the Q&A capability for faster insights. So a modern core system lets them pick and choose the right partners for their specific needs and their markets, all while staying within a common architecture, which is a real benefit there for keeping integration time and costs low.

Chris Daniels: You’re spot on. I spent most of my career, as you know, working on the carrier side. And honestly, you know, not that long ago, integrating a new vendor or service partner was a real challenge. It was a nightmare. We were so dependent on IT, time, and resources to hard code things. Things that today have really become seamless, more plug and play that you said earlier. You know, if we couldn’t get the work prioritized, we just had to ask our staff to log into another external system just to get the job done. It slowed everything down, created frustration across the board.

Laurie Von Dauber: Exactly. I think it’s still a real issue for a lot of carriers. And in fact, it reminds me of a recent engagement where the claims leadership was telling us that their teams were bouncing between nine different third-party systems just to handle daily work. So that’s why it’s not just about integration. It’s really about that smart connected workflow, as well as the ability to retrieve third-party data. That’s also really important. Core systems need to integrate with partners, allowing for ingestion of application and third-party data for that prefill during the quoting process. And then during the policy lifecycle itself, partner support things like servicing with the call center functionality or billing and payments, texting. All of that aids in productivity and efficiency.

Chris Daniels: Right. And you know, from a claims perspective, you know, we see something similar. Carriers are increasingly looking to use data not just on the back end, you know, after the fact for reporting, but they’re looking for real-time insights into workflows to support decision making, especially around predictive and prescriptive analytics. So, Laurie, we started getting deeper into the specific functions. And so let’s think about how carrier expectations play out differently across policy billing and claims. Laurie, can you walk us through what carriers are really looking for?

Laurie Von Dauber: Sure. So as the backbone of an insurance operation, a policy admin system needs to be robust, needs to be flexible. It needs to be efficient to handle large volumes of both policies and transactions on those companies. These it needs to be cloud ready for better scalability. Policies need to be issued timely for the profitability piece of it. And this is where the frameworks and tools to support underwriting really come into play. As we’ve been talking about today, that really helps automate risk assessment as well. And the underwriting decisions, the role of the underwriter is elevated to work on submissions where risk characteristics are outside of the risk appetite defined for the straight-through processing. I think a well-laid-out underwriter dashboard is really important, right? It needs to have those capabilities for notification for when the underwriter gets involved. And that leads us then to the supervisor manager visibility into tasks assigned and things like reporting on metrics for task completion time. From what I see, carriers are looking for that workflow management and the work distribution handling. And as I think about it, some other things that are coming to mind are communication. That’s an important piece, such as quote proposals that automatically will be e-mailed out to the agent. It’s really important for carriers to consider what workflows and policy transactions are also pre-built in the core system. Are out-of-sequence endorsements supported? What about audits? In a current client engagement that I’m working on, I see the need for digital channels for intake. Then as submissions are received, the underwriter needs to be notified from the underwriter dashboard. The underwriter wants to see their list of submissions. They want a means of prioritizing those to know what to work on first. And then with that being said, it’s important to track when those items are due via those dashboards to see that assigned work across teams.

Chris Daniels: So these things focus on the underwriters’ operational efficiency. How could the core system support a carrier’s growth into new markets?

Laurie Von Dauber: Yeah, when creating new products, it’s really important for the carrier to think about how fast it is to roll out a new, a new product or a new state for an existing product. Some common questions asked, do you integrate with ISO, how are state jurisdiction, specific rules handled and tracked? In each of the demos that I’m giving, I’m highlighting that ability to configure the different products. Carriers really need that flexibility to configure those customized products quickly to meet those market demands. Now, thinking about it also, you know, a policy system, it needs to integrate with third-party data sources like your credit scores and geolocation, but it also needs to seamlessly integrate with your billing and claims systems. Now, when I think about billing, which might not always get into the spotlight, but in P&C insurance, it’s really mission critical. It impacts cash flow, customer satisfaction, and the retention, as well as that operational efficiency.

Chris Daniels: Right. You know, billing is not glamorous, but it is where trust meets the bottom line.

Laurie Von Dauber: Exactly. And what’s most important in billing is flexibility and bill plans, integration with third-party payment processors and banking systems. For your CSRs, that real-time account visibility into balances and payment history to handle those customer inquiries efficiently, your batch processes and automation, things like automated dunning and collections. So a modern billing system isn’t just about collecting premiums, it’s about enabling trust, reducing friction, and then delivering cash flow.

Chris Daniels: I think your point about trust and reducing friction applies to just as much as claims. From a claimant or policyholder perspective, trust is built, or even lost, in those first few touchpoints. Things like real-time updates and tracking automated payment status. Those things go a long way into reducing the anxiety associated with filing a claim. It can really simplify the experience and help with claimants feeling control. And of course, for adjusters, it’s about streamlining how they prioritize their work, how they investigate and settle claims. And you know, above all, not about drowning them in manual steps and workarounds and having them work in disconnected tools. All of that connects back to the core system. And I think it’s a perfect transition for how we’re going to wrap our discussion today. AI. AI is everywhere right now, and it’s quickly becoming part of the conversation around core systems, not just as a bolt on, but really as a driver of how systems and platforms are being built and used. Laurie, spend a minute and tell us how AI is further enhancing modern P&C core systems and underwriting.

Laurie Von Dauber: AI is everywhere right now, and it’s one of the insurance industry’s favorite two letters. AI technology is transforming insurance with efficiency, data-driven decision making, and of course, an enhanced customer experience. In underwriting. further enhancements will accelerate that straight-through processing. It’s going to automate more and more underwriting and leverage the expertise and the experience of the underwriter. It’s also going to allow the carrier to offer highly tailored policies to the insured. Now, I met with an underwriter last week who had been with their company for nearly 40 years. So she has that deep, tacit knowledge. I see AI amplifying her 40 years of wisdom, not replacing it. So AI really becomes a tool. It’s not a substitute. For example, instead of manually reviewing hundreds of pages of documentation, AI can go ahead and do that presorting and highlighting risks that the underwriter can then evaluate the true significance of. So your underwriting jobs just got more strategic, focusing on those complex cases and building those client relationships with a lot less paperwork.

Chris Daniels: Right. You know the articles and blogs that I read, you know, are saying that nearly two thirds of the large P&C carriers are expanding their use of large language models, specifically around document summarization, the example you were sharing. A final thought on AI. And I’m here seeing and reading lots of discussion on this. And it’s really about how carriers are working to balance the AI-driven speed and efficiency and keeping human empathy at the center of the insurance transaction. And I think that’s probably a podcast for another day.

Laurie, thank you so much for joining me today and for sharing your insights. There’s clearly a lot to unpack when it comes to core system modernization and P&C.

Laurie Von Dauber: I know we really just scratched the surface today, but I do hope our listeners took something from our time together. Thanks so much for inviting me.

Chris Daniels: Absolutely. To everyone listening. Thanks for spending time with us. We always appreciate your feedback. So if you’ve got questions, comments, or topics you’d like to hear more about, don’t be shy. Reach out to us on social or through our website. And of course, don’t forget to subscribe! We have more great conversations coming your way right here on the Sapiens Insurance 360 podcast. Bye for now!