Core system modernization remains one of the most significant investments an insurance company can make. I hosted the most recent Datos Insights Women’s Network virtual meeting where I shared survey results from our recent core system transformation study (Navigating Core System Transformations: Trends, Challenges, and Lessons From P/C Insurers, January 2025), and three industry leaders shared their experiences navigating these complex, multi-year transformation projects. Here are the key takeaways from our discussion.
Strategic Approach Matters: Planning for Success
The panel unanimously agreed that having a well-defined strategy is crucial before embarking on core system modernization. As one panelist noted, “When we decided to go with this solution, we didn’t have a strategy about how we would approach it, and I believe that’s why it’s taken us fifteen years.”
A successful approach includes developing a comprehensive roadmap with executive buy-in, defining clear deliverables, and creating a realistic timeline. One panelist highlighted their “Road to Ready” initiative—a dedicated preparation period before implementation began. This preparation included building out comprehensive knowledge transfer checklists and engaging contractors to manage legacy systems, allowing their internal team to focus entirely on the new implementation.
Organizations that invest time in preparation see better outcomes. This includes understanding current processes, documenting requirements, and most importantly, being open to adapting business processes rather than customizing new systems to match legacy workflows. As one panelist advised: “Be open to the possibilities. Think differently. Go into the project with the mindset of ‘we’re going to take a look at what we do and why we do it.’”
Balancing Customization and Business Value
A critical challenge identified across implementations was finding the right balance between customization and leveraging out-of-the-box functionality. Many insurers initially approach modernization with the mindset of replicating their existing systems and processes. As a panelist described, “We essentially took our legacy systems and said, ‘How do we turn this software into our legacy system?’”
This approach often leads to excessive customization, increased costs, and extended timelines. The panel advised future implementers to resist this temptation and instead focus on adopting standardized processes where possible. One panelist shared: “If I could do it all over again, I wouldn’t look to customize and rebuild the old legacy system. Take the software, try to use a greenfield approach, try to convert your business processes in a way that meshes well with the system.”
The most successful implementations found ways to differentiate their offerings without overcomplicating the underlying technology. A panelist noted this balance: “You want to keep as close to out-of-the-box as possible. But if you’re just out of the box, then you’re like every other insurance company. So you need to find that line of customizing enough to make yourselves different.”
Change Management and Team Empowerment
Perhaps the most consistently emphasized factor for success was effective change management and team support. Core system implementations are fundamentally people challenges as much as technology ones. The panelists, all women leaders, highlighted how their leadership styles contributed to project success through servant leadership, empathy, and team empowerment.
One panelist shared, “For me, it’s really just taking care of the team because they are in the trenches. They know what’s going on.” Another panelist emphasized the importance of acknowledging accomplishments along the way: “Take time to actually reflect on what we have accomplished even though we’re not pushing out a shiny big thing every couple of weeks.”
The panelists also stressed the importance of bridging gaps between IT and business stakeholders. “It’s not IT versus the rest of the business. These are company initiatives. We have to work collectively as a team.”
One panelist highlighted the emotional dimension: “Do not underestimate the emotional element. You can sense when people are afraid, and when they’re afraid, they will step back. Give them a reason to not be so afraid to ask the questions they need to ask.”
Conclusion: The Marathon, Not the Sprint
Core system modernization is “a marathon, not a sprint.” These transformative projects require strategic vision, organizational alignment, realistic expectations, and persistent leadership. The panel’s collective advice emphasized preparation, flexibility, and keeping the end goal in focus throughout the journey.
Despite the challenges, the rewards are substantial—from increased operational efficiency and improved time-to-market to enhanced digital capabilities and better customer experiences. As organizations continue to undertake these transformations, the lessons shared by these experienced leaders provide valuable guidance for navigating the biggest, hairiest, scariest projects in insurance technology.
Our next Datos Insights Women’s Network virtual meeting is on Wednesday, April 23. For more information on the Women’s Network and how to join, please visit our website.
