Best Practices for Insurance Legacy Claims System Replacement


In the quest for efficiency, flexibility and the ability to easily organize workflow, claims managers are quickly realizing their legacy claims systems are standing in the way of these objectives. Insurance adjusters are beginning to understand that something needs to be done, however the options that are available to solve the problem can sometimes be vast. The procedure to integrate your existing legacy insurance claims system, data, and information into a new system that includes new business processes can become an IT conundrum.
Insurance claims software systems are critical and can hold vital information that was acquired over the life of the company. The data is big and stuffed with years of useful information, and it is not surprising that legacy claim systems at times don’t play well with modern technology processes and systems. Claim Managers have made very large investments into their existing software claim systems, and can be hesitant to implement new changes. Scrapping legacy systems and replacing them with more modern software can involve a significant business risk, however it makes it possible to get the best of the old and new, and take advantage of new technology processes.
To make an easier migration for insurance adjusters first identify the best type of migration for your data. For smaller carriers it is possible to effectively cut loose and replace your entire system at once. For carriers that are larger with several lines of business your transition may need to be done in a trickle down method. Both your legacy and modern claims processing system should run in correlation with each other before fully deploying the integrated claims system.
A few things that will make your migration a bit easier is identifying the best type of migration for your data:

1.   Straight Migration

This means you want to move an existing system to a different technology altogether without any feature upgrades. This is mainly done if you are only interested in reducing maintenance costs and improving performance.

2.   Extension

This means you want to add an external application interface that accesses and updates the same data that the current system accesses. This is usually done because the current system is running fine, but it is not cost effective or there are no options to upgrade the current system.

3.   Migration with Upgrade

This means you want to migrate all the features, security, and data of the current system, but add some new features and review existing ones. This is usually because the scope of the original system has changed significantly or an organization feels it is cost effective to review and include upgrades during the migration instead of in the future.

A few other points that you should address before a legacy system migration include:

1.    Availability

This is the ability of the system to be running and available to all stake holders. When migrating a system it must be clear as to how the switch from the old system to the new system is going to take place and what precautions are being used to ensure adequate availability.

2.    Communication

The success of a migration is largely determined by how well the developers can communicate and have access with stakeholders or management. This ensures that questions and testing proceed in an efficient manner. It is also helpful to ensure that there are scheduled times to meet and discuss the progress of a migration and any issues that have surfaced.

3.    Road Map

When a system is reviewed for migration there should be a road map that outlines everything the system should do and how people interact with it. Priorities should be clear and authorized personnel should be noted. If this is not clearly written it means that deadlines may be pushed back and possible loss of features or concepts may result.

4.    Priorities

Often times there are features or concepts of a system that have a level of priority. These priorities should be listed in the road map. This will help determine if a feature is really needed and if additional considerations should be made for higher priority items.

5.    Expectations

Often times when migrating a system, there are concepts or features that don’t translate exactly as they did before. It is recommended that your focus be placed on what is being accomplished and how efficiently is it accomplished instead of how the concept or feature was before. Good communication during a migration allows you as the owner or manager to understand these issues and make an appropriate decision moving forward.

6.    Permission

Significant setbacks can occur if there is confusion on who has the authority to say what goes and what doesn’t when issues arise. This can usually be avoided if a well thought out road map is constructed before implementation begins.

7.    Testing

There is usually a significant amount of time invested in testing a system by the developers during implementation. However, it is ultimately the requestor’s responsibility to give it a thorough review as they have the best relationship and understanding of the data and processes the system manages. Doing so in a timely fashion before and after deployment will help to resolve any bugs.

There are different approaches to the modernization and replacement of legacy claim systems.  The insurance claims management industry is embracing change now more than ever before. With the right knowledge and a solid roadmap large deployments and replacement solutions can successfully become less stressful and contain less business risks.