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Legacy systems hamper customer satisfaction drive

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Life insurers must clean up the legacy systems plaguing their administration if they want to provide a better customer experience, a financial consultant has warned.

QMV Principal Consultant Wendy Colaco says insurers need to develop streamlined systems that can capture the right customer data from multiple legacy administration systems, including those of providers, employers, superannuation fund members and administrators.

There is a need to develop simplified, innovative systems, and greater use of analytics within those systems, which could solve the problem of insurers not receiving the right customer data from external legacy systems such as super funds, she says.

Bad customer data can have a significant impact on an insurer’s risk management and payment information, and can affect the bottom line.

Ms Colaco says if a super fund has not been providing a client’s updated salary information to an insurer, when the insurer receives a claim a decade later it will have foregone years of premium increases.

If a policy is written based on the client’s previous financial-year income, the insurer may pay out more than reserved for.