The Transformative Impact of Low-Code Platforms on the Insurance Industry

The insurance sector is going through unprecedented digital disruption. Startups are challenging incumbents with disrupted business models while customer expectations have rapidly evolved. Legacy systems and processes struggle to keep pace. For insurers to survive and stay competitive, they must digitally transform. This imperative makes low-code software development platforms an extremely compelling option.

Low-code solutions enable insurers to accelerate development and innovation cycles to meet rapidly changing market demands. While not a silver bullet, low-code brings transformative business benefits around agility, cost reduction, and improved experiences when applied strategically.

Digital Disruption and Transformation Imperatives in Insurance

The insurance industry faces an existential digital disintermediation threat. Startups leveraging big data, IoT, and AI are tackling every part of the insurance value chain. Lemonade is using bots for automated claims processing and underwriting. Metromile‘s telematics-based usage-based insurance attracts digitally-savvy customers. Clearcover cuts costs via its mobile-first, algorithm-driven platform.

Meanwhile, customer expectations have changed. Policyholders demand personalized, omnichannel digital experiences comparable to tech giants. They expect real-time, mobile-enabled interactions and rapid claims resolution.

Most insurers recognize this reality, but struggle to adapt rigid legacy systems designed for analog processes. As the chart below from McKinsey shows, insurance has lagged other industries in digital maturity:

Insurance Digital Maturity Lags Behind Other Industries

Insurance Digital Maturity Lags Behind Other Industries. Source

74% of insurance executives in a recent survey agree they must digitally transform to survive and stay competitive. However, legacy systems, data silos, and skills gaps impede their evolution. This makes low-code platforms an essential tool to bridge the insurance technology gap.

Why Low-Code Development Matters for Insurers

Low-code platforms mitigate several key challenges insurers face in digitally transforming with traditional code-heavy approaches:

1. Legacy Modernization Roadblocks

Most large insurers rely on antiquated systems running COBOL code. These systems designed for analog processes struggle to support digital capabilities. Pressure builds for transformation, but core system overhauls carry major risk and require armies of developers.

Low-code integration layers can help extend legacy systems to enable key digital use cases. Platforms like Mendix, Microsoft Power Apps, and Outsystems have insurance accelerators tailored for this. Low-code can integrate data and functions from core systems while modernizing UIs and processes.

2. IT Skills Shortages

The insurance industry suffers from tech talent shortages. 70% of insurers say skills gaps impede digitization. Competition for software developers is fierce across all industries.

Low-code democratizes development, enabling non-technical business users to participate. They can transform workflows within their domain expertise quicker than waiting on the IT organization.

The "citizen developer" approach enabled by low-code platforms amplifies an organization‘s overall productivity. Work gets done faster.

3. Slow Speed to Market

Insurers need to rapidly adapt to market changes. But for most, their release cycles are 6 months on average. Lengthy development schedules from traditional coding inhibit their ability to innovate.

Low-code platforms speed development cycles by 5-10X. Insurers can build and iterate on apps faster, enabling greater experimentation. Quick wins build momentum for larger efforts.

4. High Costs and Technical Debt

Major legacy replatforming initiatives carry extreme costs and risks. But the status quo has its own costs from inefficient processes, poor data utilization, and technical debt.

Low-code solutions provide a faster, cheaper alternative to rewrite everything from scratch. They can deliver tangible improvements and free up budget for broader modernization.

For these reasons, low-code development is becoming a strategic imperative for insurance digital transformation.

Low-Code Use Cases and Examples in Insurance

Low-code platforms are well-suited for building customer-facing applications and digitizing frequent processes. Common insurance use cases include:

Customer and Agent Portals

Policyholders expect omni-channel digital experiences for account management, application status tracking and self-service. Low-code delivers portals faster. Farm Bureau Property & Casualty built customer portals 3X faster with Oracle APEX.

Agents also benefit from portals to manage clients, submit applications, and access analytics for growth. Pacific Life developed agent tools 75% faster with Salesforce Lightning.

Digital Underwriting and Real-Time Quotes

Tedious paper-based application processes frustrate customers. Low-code systems like Bolt‘s quoting engine deliver real-time underwriting using analytics to bind policies in minutes not days.

Omnichannel Customer Support

Policyholders expect seamless support across channels. Low-code enables insurers to quickly build chatbots like Lemonade‘s AI Jim, improving CX and containing costs.

Claims Processing and Fraud Detection

Lengthy claims processes also erode loyalty. Low-code workflow automation reduces settlement times. Rule-based systems can also auto-flag suspicious claims for fraud analysis, using machine learning for more complex cases.

Third Party Integration

Insurers rely on many third party systems for data enrichment. Low-code simplifies system interconnection. This improves data leverage for underwriting accuracy and provides a 360-degree customer view.

These examples showcase low-code‘s speed, flexibility, and ease of integration. Insurers utilize it for both incremental improvements and to enable breakthrough experiences not possible within legacy constraints.

Low-Code Success Stories in Insurance

Here are some real-world examples of large insurers reaping major benefits from low-code platforms:

  • Farmers Insurance fully re-architected their agent portal and customer mobile app with low-code, retiring 100 legacy systems. Response times for agents improved 5X while call volume reduced 17%.

  • Malaysian life insurer Etiqa developed an end-to-end digital underwriting and policy admin system with OutSystems. It reduced policy issuance time from days to under an hour while cutting IT costs 42%.

  • CNA Insurance built a self-service portal on Appian to let agents and customers directly manage policies. This reduced call volume 15% and improved agent productivity 46% through faster quoting.

  • USAA used Salesforce Lightning to overhaul their claims system, reducing adjustment times by 50%. Their customer satisfaction (NPS) scores subsequently rose 8 points higher than competitors.

These results validate low-code‘s benefits. Insurers achieve hard ROI around cost reduction, CX gains, faster processes and productivity improvements.

Challenges and Mitigations in Leveraging Low-Code

Low-code adoption is not without challenges. Being aware of pitfalls enables mitigation through governance and discipline:

  • Lack of flexibility – Some use cases may require code customization if beyond platform limits. IT involvement ensures the right tool for the job.

  • Integration complexity – Connecting to legacy systems can be tricky. API-led integration helps, along with architects overseeing data flow.

  • Technical debt – Reuse of components and enforcing standards avoids downstream issues of disjointed systems.

  • Compliance risks – Developing regulated applications like underwriting requires IT oversight to meet requirements.

  • User adoption – Business teams require training and change support to capitalize on low-code tools.

A DevOps approach combining IT governance with business agility helps balance these factors for sustainable success.

Best Practices for Implementing Low-Code in Insurance

Follow these best practices when launching low-code within insurance firms to maximize results:

  • Start small with a well-scoped pilot, tight feedback loops and measurable metrics before scaling.

  • Maintain IT and business alignment – IT provides guardrails while empowering business needs.

  • Take an iterative approach – focus on speed, continuous delivery and incremental improvements.

  • Involve process experts early – they know optimization opportunities within existing workflows.

  • Invest heavily in training and change management – adoption ultimately drives impact.

  • Enforce architecture principles and design system – avoid downstream technical debt.

The Future of Low-Code in Insurance

Low-code adoption in insurance is still early but growing exponentially. Gartner forecasts low-code application development will account for over 65% of all app dev activity by 2024.

Forrester predicts the low-code market will become a $21 billion industry by 2022, noting insurance as a major growth sector.

As more insurers realize low-code‘s transformative potential, competition will accelerate adoption across the industry. Leaders getting started now will build a strategic advantage difficult for laggards to overcome.

The benefits for customer experience, speed to market, productivity, and cost savings are too substantial for insurers to ignore. Low-code platforms provide the missing link for digital transformation and a foundation for the future.


Legacy processes, data silos, and skills gaps have inhibited insurance digital modernization. Low-code development finally provides a viable path forward.

It enables both incremental improvements to extend legacy systems and breakthrough innovation that reimagines processes and engagement.

While governance and realistic expectations are required, low-code adoption can unlock immense business value. It allows insurers to meet the exponential pace of change demanded by the market while delighting customers, partners, and employees.

The research is clear – low-code development is reaching a tipping point of maturity and impact across industries. The window for insurers to leverage low-code for strategic advantage is now. Those that seize this opportunity will future-proof their organization to thrive amid continued disruption.