Cloud is rising
I participated in a conference in Hong Kong this week which was focused on discussing Cloud with insurance excutives.
For a number of years Celent has been following the development of Cloud based solutions. And in recent times it has seemingly become more and more accepted as an option for speeding up deployment times at a cost that is highly competitive compared to traditional processes.
With the management of the environment in the hands of Cloud vendors this moves the responsibility of establishing enhanced infrastructures away from the user, particularly if increased capacity is required at short notice.
I have seen a few cases over the past two years where a Cloud solution has been implemented in a disaster situation, one being during the Thai floods in 2011 and another following the tsunami in Japan. In both instances the ease of redeployment and the agility of the Cloud vendor enabled the insurer to very quickly establish systems and processes to deal with an unprecedented and unexpected number of claims.
Other case studies that we have covered show that Cloud solutions can reduce implementation and ongoing costs significantly. As the onus is on the Cloud vendor to remain up to date potential customers can benefit from this without having to plan for regular upgrades and enhancements.
On the conference a case study presented by a vendor was impressive: Insurers get more computing capacity for actuarial projections by leveraging cloud computing, without investing heavily in their computing infrastructure, potentially reducing costs and offering more computing capacity than a company would be able to support internally. The software is grid-enabled and can run on the cloud. By using a cloud solution, insurers can not only meet their computing capacity needs, but the ease of implementation and deployment from an IT perspective is also one of the most appealing aspects.
Cloud is increasingly making headlines. We see many opportunities opening up in this space over the next few years. Currently the usage still limited, but based on the Celent 2013 Asia CIO survey, the usage will increase by 2016 – companies will use more vendor provided infrastructure, platform and software as a service.