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The following is an excerpt of the Technology Innovations column I wrote that  was published in August 2016 issue of Best’s Review magazine. (Reprinted with permission by A M Best Co.)

The Cloud is fast gaining traction as the go-forward technology platform in the insurance industry.  By 2020, analysts predict, half of enterprises won’t even have their own data center. The Cloud provides lower IT costs, elastic processing power and high flexibility. In addition, it enables other digital technologies, such as social media, mobility, big data and advanced analytics. But its greatest value is providing agility so insurers can innovate to support new data and analytics-driven business products and processes digitally in real time.


Analytics as a Service is an especially high-value and fast-growing Software as a Service area that provides access to any data, anywhere, by any user at any time without needing to worry about installing and maintaining analytic apps on a user’s computer. Capabilities such as dashboards, data exploration and visualization, “what-if” scenario analysis, predictive modeling and planning are all part of a single application suite with a common user interface using a single log-in from anywhere on any device. Data can be accessed wherever it resides–in the cloud or on premise.


Imagine how this ease of use and availability can improve insight not only inside your organization but also by your customers, business partners and service suppliers.  Think of a digital corporate cockpit; an integrated set of corporate key performance indicators that can be viewed by the boardroom, middle management, technical professionals as well as operational/call center staff providing a top-to-bottom view of your business in real time allowing you to drive your business instead of just analyzing it. Data and analytics are the life blood for competitive differentiation in today’s market–be it property and casualty, life or health insurance.


The Cloud will level the playing field between digital start-ups; smaller insurers and agencies; larger, traditional insurers and large brokers. Cloud software licensing is subscription based versus fixed cost, making it more affordable as an operational expense rather than a capital expense. Beyond initial licensing and maintenance, support costs also are lower. Longer term, all applications will be Cloud based. Shorter term, digital startups have the advantage to “Go Cloud” from the get-go. But mature organizations can take advantage as well by using a hybrid supplemental approach for new information consumers (e.g., customers, partners, vendors/suppliers, new use cases).


So while Cloud apps may not meet all your needs today as they are still maturing, for maximum agility organizations should use a “Cloud-First” approach and fall back to an on-premise approach as needed to meet functionality or other requirements.


Bottom line: Don’t think of either on-premise or Cloud but rather think both; start leveraging Cloud capabilities now!        

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