Existing technology systems are a top concern for insurers

Outdated and inadequate technology systems are one of the biggest concerns facing the insurance sector in 2015, an industry survey has stated.

The Tower Watson’s Insurance Industry Outlook 2015 survey analysed the responses of 335 executives in P&C and life insurance firms. It found that apprehension about underachieving technology systems outranked worries over talent shortages and insufficient capital.

Almost nine in ten (88%) respondents put worries about existing technology systems in the top three challenges for 2015. Two fifths (41%) of insurance executives also said that upgrading to more advanced technology was the most pressing concern of the year.

The report said that, in order to get ahead, some insurers were already quickening the “pace of innovation”. Michael Freeman of Towers Watson said: “Some companies are establishing internal innovation centres to become market disruptors before they get disrupted, and more insurers might want to consider this approach.”

Two fifths of respondents said that they now saw the ‘pace of innovation’ as one of the top three threats to insurance companies’ plans. Failing to adopt big data also remained a leading threat for 30% of the insurance executives. Regulation, however, topped both big data and technology innovation as the leading worry among the executives who took part in the study.