With increased regulatory scrutiny and the financial implications of operational risk it’s more important than ever to address your legacy systems.
The pressure on financial institutions from the PRA (Prudential Regulation Authority) and FCA (Financial Conduct Authority) is only set to increase along with the need for cyber security compliance and the requirement for increased reporting and data governance (GDPR) also a key factor.
Now is the time to address and fix these issues before they have an irrecoverable impact on your business.
The FCA recently issued a statement setting out its view on operational risk management for general insurance firms during the coronavirus pandemic; in this statement the FCA stressed the importance of proper business continuity planning and process resilience. Businesses are expected to have suitable systems and controls in place to manage the operational impact of the current climate.
Additionally, the drive towards technological innovation has also been supported by regulators, with recent regulatory focus on operational resilience appearing to be more pertinent than ever.
In support of this, the FCA recently expressed that it welcomes "firms taking initiatives going beyond usual business practices to support their customers".
Regulators are looking to firms to be cognisant of the risks posed by the greater reliance on digitisation and technology. Charlotte Gerken (Bank of England PRA) said in May...
"Insurers will need to be on the front foot in identifying the potential impacts on their longer-term business models in order to meet changing customer expectations."
She went on to say…
"The insurance industry - all the people who work in it - responded extremely well to the operational challenges that have arisen from the Covid-19 pandemic. There are, of course, still challenges for all of us as we move from immediate crisis management to medium term sustainability. This includes reassessing the impact on cyber and other IT-related risks, whilst at the same time recognising the need for technology- driven solutions to support certain activities."
The challenges that businesses are currently facing are:
CyberSecurity: can your business identify breaches and report on unauthorized access?
Data: is your business able to adequately protect access to sensitive data? Are you able to demonstrate that adequate controls are in place and working effectively?
These challenges also come with technical risks where legacy systems are in place. Problems with flexibility and ongoing maintenance can be costly and time consuming.
For long term stability and compliance it is necessary to stay ahead of the game, and technology is evolving and changing the rules of the game. Many companies are choosing to move to multi-distribution models where having an application portfolio that is flexible greatly supports new ways of working.
With all this in mind, you'd be forgiven for thinking that this is a huge and expensive undertaking, and not something that you have the time or budget for. However, replacing legacy systems does not require a huge budget, it doesn't carry a high risk and equally does not need to take months to implement.
It's not as much of an insurmountable mountain as you might think.
The answer is a Cloud based solution that has a lot of capability and flexibility. A move to the Cloud does not mean a compromise, instead it provides long term peace of mind with a system that will continue to stay current.
This low risk option is developed with open source technology, uses compliant solutions and world class security. Hosted on Azure technology you have the reassurance of more than 90 compliance certifications globally and the ability to produce audit reports on data access and attempted breaches. This is future proof technology with regular upgrades, updates and release management, disaster recovery and backups every 30 minutes.
Additionally, moving to the cloud reduces on-premise risk and ensures applications remain up to date and in support.
Espire & Anchorstone have a track record of success and are able to support your organisation through this process from end-to-end, dispelling any worries or fear of change within the back office, whilst providing a cost-effective approach.
Contact us for more information and an initial no obligation discussion to explore your needs and requirements.
For more information about Espire, please visit: espire.com
For more information about Anchorstone, please visit: anchorstoneconsulting.com
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