The insurance sector is set to become a forerunner in the adoption of service-oriented architecture (SOA). Insurers increasingly recognize that their neglect of back-office transformation and focus on 'quick-fix' projects in the front-office is cost-ineffective in the long-term, and fails to address their long-term challenges in distribution.
Spend on common distribution platform projects is expected to reach $844 million by 2009. By adopting SOA, insurance firms can transform into 'plug-and-play' operations to cost-effectively connect to a variety of distribution channels and work towards a seamless customer experience.
Both the life and non-life sectors in Europe are currently finding themselves at cross-roads. Life players are being faced by an upturn in market conditions yet having to address an intensifying battle for distribution shelf space. Non-life players are having to improve cost-efficiency as premium income is set to slow down. In both cases, biting the back-office transformation bullet is becoming inevitable.
