Insurers think "everybody is doing better than us" when it comes to digital transformation, according to a new Davies and Clearwater Analytics study.
Commissioned by global consultancy firm Davies and Clearwater Analytics, an investment and accounting solutions provider, the report identified common barriers to digital transformation across the sector.
Key challenges cited by survey respondents were operational challenges in the middle office, regulatory reporting, risk and performance.
The study found that insurers of all sizes continue to be held back by inadequate infrastructure, lack of scalability and support.
Larger insurers are lagging behind, as their smaller challengers — with fewer legal constraints — can embrace new digital operations more quickly.
However, smaller firms share digitalisation concerns, with less than a quarter of all survey participants considering their organisation advanced in their journey.
A key challenge for all insurers is accessing data, driving the need for digitally automated operating models to source data and produce reports more easily amid regulatory changes.
The study shows that while all firms struggle with bespoke and ad-hoc reporting, the greatest level of manual intervention (80 per cent) was reported by larger firms.
Commenting on the findings, Tina Wilkinson, consulting division partner at Davies, says: “Our report is painting a picture of insurers paranoid about their progress relative to peers. While digital native firms have the advantage in launching new services and onboarding new asset classes, they can’t compete with more established players when it comes to deep data assets.
“The party that solves their problems first will win the race, either newer entrants earning greater market share or traditional firms joining-up their capabilities.”
