Lumera Warns Legacy Systems Stifle Innovation in UK Group Protection and Workplace Benefits

Legacy administration systems are making it harder for group protection providers to make the most of their expertise as employers look for more flexible and connected workplace benefits, warns Lumera, a leading insurtech company driving digital transformation across the global Life and Pensions industry.

Following a period of market consolidation, many of the UK’s larger group protection providers are now running several administration and technology systems across different books of business, often with systems carrying out similar tasks.

Providers have significant product knowledge and experience, but older technology can make it harder to put that expertise to use. It leaves teams reliant on manual work, slows down product development and makes administration more difficult than it needs to be.

Modern administration platforms can make it easier to change products and processes without lengthy system development. This gives providers more freedom to respond to changing employer and employee needs, while improving administration efficiency.

Consolidating policy data under one single master platform can also give providers a clearer view of the data they already hold. Instead of member and policy information sitting across fragmented systems, it can be brought together in a more consistent form, making it easier to draw useful insights from the data and support the growing use of AI.

The ability to connect with other workplace systems will inevitably become increasingly important as employers require benefits to work smoothly alongside benefit platforms, payroll systems and other providers, rather than in isolation. Better connections between these systems can help to give employees a clearer view of the benefits available to them.

Providers do not need to move every policy at once. Books of business can be transferred gradually, including when corporate schemes renew, allowing older systems to be retired over time and reducing disruption for employers and members.

Modern platforms can also make it easier for providers to monitor their systems and keep clear records, helping them to meet growing regulatory expectations around technology and operational resilience.

Richard Stewart, Commercial Director of Workplace Solutions at Lumera, commented:

“Group protection providers have a huge amount of data and product knowledge, but outdated administration systems can restrict what they are able to do with it. The problem is often not a lack of ideas or expertise, but whether the technology allows providers to act on them.

“The direction of travel is moving towards integrated propositions that allow employers to connect with insurers, other workplace providers and benefit platforms to deliver greater value to their employees.

“Modern technology will be essential to achieving this as well as harnessing the potential of data analytics and AI to capitalise on the strategic, member-level data held by providers.

“Modernisation does not have to involve one large and disruptive project. Providers can move books of business gradually and retire older systems over time, giving them a practical route to a more flexible and connected service.”