Nearly 900 Hours of Lost Productivity Due to Downtime, Manual Workflows, and Slow System Changes

A new research report commissioned by INTX Insurance Software (“INTX”), a complete Insurance Operating System for specialty P&C insurers, MGAs, reinsurers and captives, and conducted independently by RSM US LLP (“RSM”), found that legacy platforms create measurable financial strain across implementation, ongoing support, workflow management, and system upgrades. The report, “The Cost of Legacy Insurance Software Systems: Wasted Time & Money,” found that exposure for some firms can reach up to $5 million annually.

The survey of over 250 insurance professionals found these legacy systems require internal IT support for downtime and ticket delays that add up to nearly 900 hours or $450,000 in lost productivity, while manual intervention for policy workflows creates data latency that can cost organizations an additional $1 million or more.

Legacy systems also constrain growth initiatives, according to the survey. Adding new product lines or expanding into additional states often requires months of configuration and testing, delaying revenue realization.

The report found that 72% of insurers rely on Excel or internally built tools to manage critical insurance workflows and 52% of policy administration processes still require manual intervention.

The findings come at a time when insurers are facing increasing pressure to improve operational efficiency. Industry data shows that U.S. P&C carriers have operated at an average combined ratio of 102.1 over the past 15 years when measured without investment income, highlighting how operational inefficiencies within core systems directly impact underwriting profitability.

“For years, insurers have assumed their combined ratio reflects underwriting performance, and this research makes clear that a meaningful portion of margin erosion is actually driven by technology architecture,” said Rob Lewis, CEO of INTX Insurance Software. “Legacy systems introduce structural inefficiencies that quietly drain productivity, delay growth initiatives, and increase operating costs across the enterprise. Modern insurance organizations need infrastructure designed for today’s operating complexity.”

Slow and Expensive System Implementation

As insurers look to adopt automation and artificial intelligence across underwriting and claims operations, the study suggests that fragmented legacy systems will increasingly limit the ability to deploy advanced analytics and AI-driven decision tools.

While many insurers would like to implement new systems, the cost and time make it a challenge. One-third of insurers surveyed reported spending more than $500,000 to implement a single core system, with average costs nearing $1 million. Most insurers operate two to three systems, pushing total implementation expenses as high as $3 million.

Furthermore, nearly 45 percent of insurers reported implementation cycles exceeding 18 months. It’s no surprise that the average industry implementation rating is below 72%— a C-minus—reflecting extended timelines and operational disruptions. Respondents indicated these delays limit their ability to respond to regulatory changes and shifting market conditions.

Emerging Modern Solutions Provide the Answer

There is a light at the end of the tunnel, however, as a new generation of insurance platforms are emerging to address these limitations. New models that eliminate costly implementation fees and reduce reliance on third-party system integrators remove layers of complexity and accelerate time-to-value for organizations. These systems also consolidate policy administration, billing, claims, reinsurance, and reporting into unified architectures designed to eliminate manual reconciliation, reduce implementation complexity, and provide real-time operational visibility across the enterprise.

“A new generation of insurance platforms is emerging to address these structural limitations. These systems consolidate policy administration, billing, claims, reinsurance, and reporting into unified architectures designed to eliminate manual reconciliation, reduce implementation complexity, and provide real-time operational visibility across the enterprise,” Lewis added.

The full report, “The Cost of Legacy Insurance Software Systems: Wasted Time & Money,” is available at https://na2.hubs.ly/H042Hbn0.

About INTX Insurance Software

INTX Insurance Software is a complete Insurance Operating System for specialty P&C insurers, MGAs, and captives. INTX unifies policy administration, billing, claims, reinsurance, and reporting into a single, configurable platform designed to eliminate operational fragmentation and enable efficient scale. Built API-first, INTX integrates with partners and services, allowing insurance organizations to launch faster, operate with greater transparency and accuracy, and scale without the cost and complexity of legacy core systems. For more information, please visit INTX Insurance Software.

About RSM US LLP

RSM empowers middle market companies worldwide to take charge of change. The clients we serve are the engine of global commerce and economic growth. Our unique middle market perspective makes RSM the natural choice for growth-oriented, internationally active organizations seeking relevant insights and tailored, innovative solutions for a complex and changing world. With a global reach spanning more than 120 countries, we instill confidence in a world of change by bringing the full power of RSM to make a lasting impact on our clients, colleagues and communities. For more information, visit rsmus.com, like us on Facebook and/or connect with us on LinkedIn.

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“For years, insurers have assumed their combined ratio reflects underwriting performance, and this research makes clear that a meaningful portion of margin erosion is actually driven by technology architecture,” said Rob Lewis, CEO of INTX.