COLUMBUS, OH — (MARKET WIRE) — 03/29/10 — Sterling Commerce, an AT&T Inc (NYSE: T) company, today announced the results of a global insurance industry survey that highlights emerging priorities for companies in this market. The top two priorities for recovery were to improve customer service and operational efficiency. The survey, commissioned by Sterling Commerce, was conducted by research company Vanson Bourne and independently analyzed by TowerGroup, a financial services research and advisory firm, in reports available today.
Challenges in data integration create obstacles for insurers in meeting their customer service and operational efficiency priorities. The survey indicated that approximately half of all insurers face data integration issues as they relate to multi-enterprise (external) connectivity as well as internal (EAI) integration, with some variance per market:
- European insurers consider issues with external and internal integration almost equally, with 46 percent citing external connectivity and 48 percent citing internal integration.
- North American insurers consider their external integration challenges are significantly greater, cited by 56 percent, versus only 33 percent citing internal integration.
“These reports demonstrate that the insurance industry suffers from severe data movement challenges that affect companies’ ability to meet customer demands, and ultimately, successfully recover,” indicates Karen Pauli, research director, insurance at TowerGroup. She adds: “The leading insurers are improving efficiencies and risk management, maximizing the potential of each distribution channel, and improving customer experience by using technology to integrate data, and present it accurately, completely and quickly to the destinations where it provides operational value and enhances profitability.”
The reports also highlight several pitfalls in data movement. For example, a majority of insurers in both Europe and North America have created a policy and strategic framework for data movement; however, both regions indicate that those policies are not consistently applied through the use of software. European insurers are significantly ahead of North American insurers in addressing this issue, with 52 percent of respondents indicating they have applied the policy consistently, but only 23 percent of North American insurers have done so.
Recent (and continuing) market conditions are at cause in falling premium revenues on the distribution side of carrier operations, and in falling investment income on the fund management side across all of the business lines, and on both continents. To prepare for recovery, insurers’ priorities include:
- Customer service — Significantly impacted during the financial crisis, insurers need to rebuild customers’ trust by meeting expectations for “anytime” access to their insurance provider, across multiple communication channels.
- Profitability — Insurers are focused on reducing operating costs by overcoming data management challenges and eliminating siloed systems. The reports highlight improvements carriers can individually implement as cost reduction measures across central data processing operations; for example, the elimination of costly error-prone manual processes through automation and simplification of claims processing and policy administration.
- Business growth through market diversification — Achieving greater revenues from a wider range of global marketplaces. One option highlighted in the reports was for insurers to adopt simpler product lines, generating short term savings, and targeted at specific markets such as retirement. These are meant to “appeal to consumers who believe that simpler is better,” says the European report.
“As in many industries, the insurance market faces dramatic risk and opportunity as the economy turns around,” said Jim Gahagan, global financial services industry executive, Sterling Commerce. “To pursue these opportunities, many insurers are turning to our intelligent process integration solution, the Sterling Business Integration Suite, to enable straight-through-processing between different legacy technologies and across multiple business locations and system silos.”
The market research addressed the Property and Casualty business in North America, and both the Life Assurance and General (Non-Life) business in Europe. Fifty major national and multinational companies were contacted across the USA and Canada. Fifty similar companies were contacted across the UK, France and Germany. In each country, respondents were divided equally between customer-facing business professionals and IT professionals.
About Sterling Commerce
Sterling Commerce, an AT&T Inc (NYSE: T) company, helps companies optimize and transform their Business Collaboration Network to accelerate revenues and reduce costs. Sterling Commerce provides more than 30,000 customers worldwide applications and integration solutions to connect, communicate and collaborate inside and outside their enterprise. More information can be found at www.sterlingcommerce.com.
Add to Digg Bookmark with del.icio.us Add to Newsvine
For more information, contact: Julie Redard, Sterling Commerce, (978) 513-6386, Julie_redard@stercomm.com Jamie Leicht, Fleishman-Hillard, (619) 237-7711, email@example.com