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What is Legacy Technology in Insurance?

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Updated on November 15, 2022 by
What is Legacy Technology in Insurance?

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As a business owner, have you ever had a situation where you were hesitant to change, even when you knew that the change was good? Typically, such a scenario occurs when the process of change is deemed too expensive and time-consuming to make it worth the price of admission. Such is the case with legacy software, where business owners become stubborn with regard to older systems and computers that still hold valuable data.

For a business that's been in the industry for years, such a change can mean potentially transforming the company from the ground up. Typically, some solutions such as software updates can help, but there comes a time when the primary platform is too old to make a sizable difference.

Why it matters in the world of insurance

Company owners can be hesitant with regard to making changes due to time and budget constraints. There are also situations where people are so used to traditional processes that they feel it's not worth making significant changes for the sake of dealing with legacy software. The reason why it matters in the world of insurance is that the old pieces of software and hardware tend to hold valuable data collected over years of company management in a competitive industry landscape.

Looking into software solutions for insurance industry purposes should be a no-brainer, but the reason why legacy software continues to be an issue is due to the overall challenge of shifting to a new foundation.

The Average Household Income in the...
The Average Household Income in the United States

How insurers could potentially transform their companies by shifting away from legacy software

It’s a shame that so many insurers are resistant to change, considering the fact that modern tech and software solutions help the insurance industry so much more than they might think. For example, those who rely on legacy software can’t take advantage of more flexible pricing with the help of a power rating engine. Instead, they’ll rely on manual systems based on old data, taking more time and manpower to accomplish even the most trivial tasks.

On the other hand, a rating engine can take preferences into account and develop accurate pricing solutions without having to worry about doing everything manually. Such a thing eases the burden to the point where insurers can focus on marketing and other aspects to help grow their business.

How new businesses can take advantage of the current situation to thrive

There’s no doubt that the most popular insurers have already taken the time to shift from legacy software to something that works best for the challenges of today. That said, not too many insurers have made the jump, allowing inexperienced company owners to take center stage and potentially grow in popularity thanks to software solutions. In the case of insurers, a new business with new software could potentially outperform companies with years of experience.

For any business owner that feels their legacy system still works, it’s a good idea to look into how current software solutions can help your company thrive in the modern age. You’d be surprised how easily you can manage a business when you aren’t held back by legacy tech.

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