InsurTechs and Carriers are adopting a transformative approach rather than incremental partial improvements to their current systems. While other industries continue to focus on offering excellent customer experiences, InsurTechs have unique challenges across the product development process.
The Accelerate State of DevOps Report 2021 highlighted the importance of software delivery in ensuring powerful business outcomes. It attributed organizational performance to excellence in software delivery and operational performance as technology transformations remained at the helm of initiatives. While accelerating the push toward greater productivity and superlative customer experiences, the shift to digital has enabled organizations to reduce operational costs by up to 40 percent. This applies to InsurTechs, that are also looking for ways to alter operating models and cost structures by leveraging automation and digitization.
CTOs and technology leaders are now required to rapidly build new-age solutions and scale the digital platforms to fast-track processes and business transactions. From conceptualization and building a prototype to validation and design iterations, it’s quite an uphill task to create products that meet customer and business expectations, deliver value, work seamlessly, and provide a competitive advantage to InsureTech.
Clearly, staying on top of the game while winning the war on scalability, performance, and security is easier said than done and necessitates having a versatile and reliable technology partner to collaborate with.
Top Scenarios where Technology Partners can Add Value
Product innovation is a complex, multi-dimensional problem with numerous variables that can change abruptly and requires agility to respond to these changes quickly. At every stage of the product journey, the expertise required varies, and having to get specialist help is unavoidable.
The ideal option is to have a partner whose depth and range of tech experience is complemented with a flexible working model to allow quick and easy changes in the scope of engagement and the resources assigned.
Ideation – Evaluate ideas and crystallize their value
While ideas can be plenty, picking the right ones need experience and foresight. Ideas need to have the potential to solve users’ problems in impactful ways and should be checked based on criteria like feasibility and competition.
An experienced product manager is needed to translate the tech idea into a high-fidelity prototype for demo purposes to ensure it fits well into the company’s customer experience (CX) narrative. Additionally, design thinking expertise becomes crucial at this point for storyboarding and creating high-fidelity mockups. This is the time when InsurTechs need to analyze the target segment and define their value proposition.
Creation – Translate the idea into an MVP
In this phase, InsurTechs need a proper development roadmap for building an MVP with the core IP. It involves exceptional planning that outlines estimates, timelines, and resource allocation. A tech team for IP development, specialists for non-core development, and significant investments in cloud computing and storage are some of the immediate requirements ISVs need to address urgently.
An experienced product development partner with relevant experience is often preferred since the right one will come with relevant insights to evolve product functionality and enhance the process flow.
Validation – Verify the value assumptions and business potential
A crucial validation phase involves verifying the concept and deploying pilots to ensure the ideas see the light of day. At this point, you need to check if the product is up to the mark and calls for integration with customer systems and modification of use cases to the client context.
What they need is product engineering experts who can quickly work around these concerns to minimize time-to-market, quantify the impact, and deliver desired results. Transforming legacy systems into modern versions with better features and performance also needs skills that in-house teams often lack.
Iteration – Finalize the product, features, and USP
The MVP is refined or modified at this stage to ensure it is designed and developed to scale. This phase allows InsurTechs to adopt a modern application design to add features and functionality and integrate security into the stack. There should be scope to scale up too as often as required.
An efficient tech partner can conduct all the quality processes to enable reliable performance. After satisfactory testing and critical evaluation, the product is deployed for production. In the production environment, the maintenance teams work on improvements after the product’s launch.
Acceleration – Build to scale, build to last
Creating a product is not enough unless you onboard customers quickly with the right strategies. The story continues as there will be new product variants and multiple customizations to look into.
The need to invest in building core teams to drive product innovations and manage server infrastructure is often felt. The right technology partner can help curate rewarding customer experiences based on better reporting, analytics, and tech insights.
Operation – Streamline the customer experience, identify the next idea
An important aspect of automating service delivery is having a 24X7 Ops & Support team. User interactions become a priority at this stage.
A good technology partner plays a big role here that can take corrective action when necessary to ensure needs are satisfactorily met throughout the user journey. The ones who understand it constantly upgrade and add new features while working toward automating operations, enabling new product development, and enforcing the right strategies for ongoing GTM (go-to-market), deployment, and product support.
A Successful SDLC (Software Development Life Cycle) is the key
A reputable software company specializing in the development of security software suffered a fine of $10 million that was imposed by the Securities and Exchange Commission (SEC) for failing to disclose security vulnerabilities in its software adequately. Experts argued there were several more vulnerabilities, and some could have been easily detected during the code development and review process. It emphasized the importance of having a flawless SDLC.
In fact, failures from the past offer invaluable lessons to startups and unicorns alike.
A classic case in point? A blood-testing startup!
Touted as the rising star of Silicon Valley, the company shot to fame for its supposedly revolutionary technology. Despite all the tall claims, the inherent problem in their success story was that the technology failed miserably. It led to incorrect test results upon which life-altering medical decisions were being made. A robust SDLC process executed by a competent tech team could have helped prevent this scandal.
On the other hand, there are top InsurTech unicorns that have successfully managed to leverage advanced technologies and analytics to solve real-world problems with consumer-friendly solutions. A successful InsurTech unicorn, for instance, relies on deep tech, data science, and 300,000 data points to estimate risk factors and eliminate traditional barriers while offering tailor-made policies.
InsurTech startups and unicorns are now enabling innovation and automating manual processes to reduce costs and increase productivity. However, their biggest challenge is ensuring stringent quality throughout the SDLC. A framework that defines various steps involved at different stages of software development entails a detailed plan for software creation, testing, distribution, and maintenance to enable value creation. Above all, it requires niche skill sets that are rare to build in-house. Perhaps why partnering for software development was predicted to rise by 70% between 2022 and 2023.
Nudging InsurTechs: Trends encouraging strategic pivots
The changing trends & insights are compelling InsurTechs to hunt for tech partners who can move the needle for them. These include:
- Founders are often Insurance domain experts but lack technical expertise or do not have a strong in-house technology team to work on the idea
- Software product development is no longer linear as we step into the open-source world with ready-to-use platforms and products
- Newer products are coming faster to the market with agility induced in thought and action
- There is a greater focus on core functionalities, and ISVs are now working within a larger ecosystem to outsource them to those with product and domain expertise
Research confirms that 28 fintech firms of the 280 that have gone past the unicorn line have played a significant role in enabling innovation and disrupting the existing insurance industry model. Interestingly, two-fifths of the world’s insurtech unicorns are based out of the US.
With an estimated market value of $ 3.85 billion and a CAGR of about 52% for the forecast period 2022 to 2030, there is no doubt the insurtech landscape is pretty promising. In the US alone, there are more than 1,300 insurtech companies; all aiming at technological upgrades, agile services, and customer-centric experiences to deal with the pressures of a maturing industry. Those who have made it big are thriving on the success of SDLC and the services of reliable technology partners who empower them to accelerate software delivery with intelligent frameworks and cutting-edge technology.
Partner with Trigent to develop products at scale
Building new capacities may be challenging, but working with the right technology partner with the domain expertise and technical know-how to build, deploy, and integrate new solutions supports delivering promising results. Trigent offers a comprehensive suite of services to enable seamless collaborations for a wide range of use cases and business functions. It specializes in best-in-class end-to-end solutions that ensure scalability as well as reliability.