insurers are beginning to
finally make some headway in
replacing their legacy systems.
Despite being a top priority of the insurance
industry for many years, legacy modernization efforts
can seem almost sisyphean in nature.
yet, insurers are starting to make some real prog-
ress, according to research from boston-based celent.
The report, “still seeing the shadow: groundhog Day
for Legacy Modernization,” queried 115 p&c insurers
in north america, europe and asia about the status of
their legacy replacement initiatives.
“The movement to tackle the legacy problem in
insurers is clearly under way, with almost half of re-
spondents in this survey noting they were well into
the journey,” the report, authored by celent senior
analyst catherine stagg-Macey, states. “if we accept
that legacy it is an intrinsic part of any established
insurer, and that this legacy is placing constraints on
business flexibility, then the imperative of addressing
this issue comes as no surprise.”
While the business need to address legacy has
long been obvious, the report notes a variety of
technology factors, including the maturity of service-
oriented architectures and modern software, have now
made it easier to address the challenge of legacy. “core
systems are more configurable than ever before,
reducing the chance of creating future legacy,” the
report states. “The track record of core system imple-
mentation has improved, along with more proven and
reliable services from implementation partners. The
outsourcing market has matured considerably, to the
extent that, for many large insurers in america and the
united Kingdom, outsourcing is an important strategic
tool for the cio.”
What is your greatest challenge with
legacy modernization?
15%
staffing
Which phrase best
describes
your modernization
progress?
budget
cuts
25%
Managing
impact on
organization
12%
11% getting
business
buy-in
24%
Deciding on best
approach
early stage of
evaluation
9%
Making the
business case
4%
Well into legacy
modernization
53%
11%
other
on hold/cancelled
7%
Legacy modernization
not being considered
completed our program
5%
Source: Celent
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