Today’s cloud-based policy administration systems (PAS) are designed to enable property and casualty and life insurance companies to manage policies throughout their lifecycle and are the foundation for carriers’ digital strategies. These types of platforms are a boon to operators seeking to enhance customer relationships and develop more effective products, but many operators do not utilize the full potential of these systems.
Operators know they need to adopt digital processes to remain competitive, and Cloud-based technology can accelerate this transition. We are seeing many customers implementing the PAS platform as a first step toward more effective digital operations. However, while implementation presents its own challenges, the real challenge lies in driving value over the long term and maximizing the capabilities of the platform to serve larger business goals.
Advantages of the PAS Platform
Operators typically implement PAS platforms with the goal of modernizing processes and becoming more agile in the market. However, many operators lack continuous delivery plans to ensure they truly realize the benefits of the new platform, e.g. Product and feature flexibility, experience personalization, rating and pricing flexibility, and acceleration through regulatory requirements.
Measuring the impact of PAS implementation
To succeed on a policy administration system (PAS) platform, insurers must establish ways to measure the platform’s impact on their business. Given recent inflationary trends, operators must determine how quickly they can implement rating and pricing changes using the new PAS. This metric will also indicate how quickly they develop and deliver new products and features to their customers. Given the frequent objections from insurance authorities to filings, the ability to quickly change insurance products will be a key measure of success. Operators should also establish an ongoing review cycle to understand how the platform performs over time. This will help them identify areas where the platform can improve and make necessary changes. Effective measurement should be the basis for improvement. When looking at the results of a PAS implementation, it is key to continually review the efficacy of the solution and look for opportunities for improvement in the performance data. A key outcome that operators must focus on is whether they are able to deliver innovation to customers through the platform. Does the PAS solution enable the business to effectively forecast market demand? Are new products being piloted and released consistently and in a timely manner?
Data accuracy is critical
PAS platforms should help operators measure whether their innovations are generating return on investment and enable them to quickly iterate products as needed. To do this, operators need to ensure that data from the PAS platform is accurate and that data accuracy issues do not negatively impact claims or billing systems. They also need to consider whether they are making the most of the data they have. Ideally, operators are able to extract data and use artificial intelligence and data science to analyze and generate insights, which are then fed back into the PAS platform so users can participate in data-driven decisions. For example, rates should be updated as soon as possible in production, and rate changes should happen as soon as the pricing and actuarial teams provide feedback.
Optimize your investments with post-implementation health checks
Regular health checks of the entire PAS product and its associated business lines help operators ensure alignment with the original goals of the implementation. These health checks should inform new goals in the future.
Additionally, health checks require insight into the operating costs of customer service representatives and underwriters. PAS platforms must create more growth opportunities while reducing costs and improving efficiency. Operators can measure success by benchmarking team productivity before introducing a solution and comparing current efficiency to projections at the time of implementation. Finally, operators can take a look at whether the solution helps teams develop revenue-generating products. They should consider whether product teams have been using data: determine whether rich data is readily available, or whether the data remains siled in disparate legacy systems. Product teams should use data to shape their product strategies, and PAS solutions should provide a more complete view of customer data across the organization. If operators find that data optimization continues to be an issue, they need to re-prioritize encouraging the adoption of data-driven processes or evaluate whether the platform itself poses a barrier to data access.
If you’re looking for ways to get more from your PAS investments, I’d love to contact you. Please feel free to contact me here.
Get the latest insurance industry insights, news and research delivered straight to your inbox.
