Let’s walk through each concern and uncover the underlying truth.
Myth 1: It’s Going to Cost a Boatload
This is the number one objection small insurers have to modernizing their tech stack. Coupled with the “our technology is fine” mindset, upgrade costs are typically perceived as a massive, single outlay. But today, modernizing the tech stack can be done incrementally, spreading costs out over time. By developing a modular roadmap that tackles specific modernizations in a prioritized way, small insurers can spend thoughtfully in a way that doesn’t break the bank. For example, a small insurer can look at their portals and say, “Let’s focus on just upgrading those first. Down the road, we’ll address becoming totally paperless or getting our adjusters situated on iPads.”
An added benefit of this approach: incremental upgrades minimize business impact. Instead of a massive project bringing the entire organization to a halt, the modular approach only touches certain components of the organization, allowing teams to plan accordingly.
Myth 2: It’s Going to Take Forever
This concern is rooted in past experience. Small insurers that have attempted tech upgrades in the past often saw those projects drag well beyond the projected completion date. And with that delay came more costs.
That’s not how today’s modernizations happen. Small insurers want to seek out tech partners that satisfy two requirements:
- They own the software they’re recommending
- Their approach is collaborative, not prescriptive
When those two criteria are met, there’s a significantly higher likelihood that the project will stick to forecasted timelines.
The modular approach mentioned above also impacts timeline, bringing clarity and operating in shorter, more predictable sprints instead of long stretches.
Myth 3: We Don’t Need to Learn Something New
Let’s flash back to the 1960s. Carbon copying reigned supreme. Then the commercial photocopier came on the scene. Some people were hesitant to use it. They liked what they were used to and didn’t prioritize the benefits (speed and volume).
Learning new technology isn’t always as daunting as you think – especially in today’s world where it is so pervasive in both our personal and professional lives. Said differently: We all use Amazon and Outlook or Gmail and banking apps and online bill pay… And we’re all pretty great at using those products. The best insurtech applications follow the design and usability principles that we’re all actually very familiar with.
Bottom line: Learning new technology isn’t what it used to be.
Myth 4: If We Mess With Our Technology, We’re at Risk of Losing Sensitive Information
We don’t hear this one that often, but when we do, we know it’s coming from someplace real. More often than not, it’s misplaced fear: If we’re making changes, surely we’re going to leak data! There’s no way we won’t lose records and documents and that really important spreadsheet that’s saved on my desktop! You get the idea.
But the reality is this: it’s all about planning.
Modernizing a small insurer’s tech stack doesn’t happen overnight. The right tech partners take the time to understand your business and assess the technology status quo. They know that no company is set up the same so trust and relationship building are key. (And if you’re wondering, yes, that’s how we operate here at Trailblazer.)
Myth 5: This Isn’t Going to be Worth It
Return on investment is a legitimate concern – especially when we’re talking about changes to critical infrastructure. This is compounded by the “we’re fine the way we are” mentality. But all you need to do is look at the large insurers. What have they invested heavily in over the last 10 years? Tech, tech and more tech. Policyholder tech. Internal tech. Payment tech. You name it.
The natural reaction to that comparison is “Well they can afford to. They have huge budgets.”
They do. But that doesn’t mean that small insurers need the same dollars to modernize their own technology. Again, it comes down to planning, a modular approach and finding the right collaborative partner.
Ready to figure out how to modernize your tech stack? We’re here to help.