Why insurance companies should choose PaaS – not SaaS
Published: April 4, 2022, 08:52 Updated: April 13, 2022, 08:51In recent years, digitalisation has been high on the agenda for most industries, including the financial sector. Digital banking solutions have been spurred on by fast-paced and innovative challengers, but in the insurance industry, many companies have fallen behind. However, this is starting to change. More and more insurance companies are investing in modern technology and portals, taking advantage of automation and striving for the benefits of artificial intelligence. Despite this increasing digital maturity and boldness, some challenges remain for the insurance companies to reach their full digital potential. At the forefront of these are the slow-moving legacy systems. A legacy system is not necessarily old. It is simply based on outdated technology that is not adapted to modern requirements or possibilities. Often they are not adapted to the cloud, but instead rely on inflexible infrastructures that need continuous patching. However, taking the first steps towards a more streamlined architecture is easier said than done – it can be both risky and expensive – and therefore more and more insurance companies are looking for modular solutions. Legacy can then be phased out step by step, while maintaining the continuity of critical systems.
Is SaaS suitable for insurance companies?
But what comes next? Although companies in many sectors have chosen some variant of Software as a Service, this approach is not necessarily the most suitable for the insurance sector. SaaS has many advantages, such as fast commissioning, opportunities to influence the design and clear pricing without risky investments. The model thus seems to be an obvious choice. But what are the downsides? Most SaaS solutions offer limited capabilities for customizing features and layouts, making them a poor choice for many companies with complex, modular needs. In addition to the fact that the constraints can result in an architecture that can not meet the company’s business needs, access to advanced configuration options can be crucial to being competitive in the global market. Another crucial downside is that most SaaS solutions are used in public clouds, or at best in hybrid cloud solutions. Although this can be both productive and cost-effective, it means that the cloud infrastructure is shared between many customers – the data is not physically isolated, which can be extremely problematic for financial players. So what choices does the financial sector really have when it comes to using the cloud in a secure and flexible way?
Why choose PaaS?
The PaaS solution – Platform as a Service – has not really reached the same popularity as the SaaS models, but when it comes to the financial market, it probably should. PaaS makes it possible for companies to use the cloud without external suppliers, which means that the cloud infrastructure can be used in all ways – and for all purposes. While the SaaS model offers applications via the web, PaaS solutions offer a reliable computer platform where both hardware and software are in the supplier’s infrastructure. This enables companies to both develop and run their own applications without being forced to maintain a traditional infrastructure. This makes cumbersome updates and resource-intensive maintenance a thing of the past. This extremely flexible model paves the way for lower costs, more efficient routines and fewer IT employees, while at the same time opening up more opportunities to create new business functions, applications and processes.
Work and store in the private cloud
With PaaS, you easily take advantage of automated distribution and optimization of resources, which saves huge amounts of time for employees. Thus, all new features and actions can be handled faster than ever – another advantage of cloud infrastructure via PaaS.PaaS also enables you to work and store data in the private cloud, providing exclusive access to all information. Thus, PaaS becomes a much safer alternative for insurance companies than most SaaS models. This complete control gives players the flexibility to easily adapt each functionality to their own unique requirements, without compromising on security. Judging by this, it is clear that many companies can benefit greatly from considering a model other than SaaS, as both the public and the private alternative can be combined in PaaS with good results. Through Comarch’s partnership with Sthlm Fintech Week 2022, a unique opportunity is offered to win tickets to the spring event 19-22 April, directly from Sthlm Fintech Week. Read more about how Comarch’s PaaS solutions for the insurance industry can help you create a safer and more efficient insurance business. The article is produced by Brand Studio in collaboration with Comarch and not an article by Dagens industri