Getting it Out of Our System
We were at a trade show recently and noticed the booths of some companies in the same business we’re in called their offerings a policy administration system (PAS). We call ours a core processing system (CPS). We wondered if that was a distinction without a difference. So, we did a little investigating, with the help of AI, of course. Here’s what we found:
In the Property and Casualty insurance industry, PAS and CPS overlap and are sometimes taken to be synonymous. But they’re not. PAS, as it turns out, connotes the policy lifecycle. CPS, on the other hand, connotes a broader operational framework.
Policy Administration System
A PAS is software that covers the administrative lifecycle of insurance policies. It’s the system of record for policy-related transactions that automates and streamlines processes from quoting to renewal or cancellation. The PAS:
- Generates quotes, binds coverage, and issues policies.
- Applies underwriting rules for risk assessment and eligibility.
- Manages endorsements, mid-term changes, cancellations, and renewals.
- Handles premium calculations and invoicing.
They may be cloud-based and/or configurable, allowing insurers to deploy new products quickly without heavy coding.
Core Processing System
A CPS is the foundational technology suite that powers core operations across the value chain. It integrates multiple components to manage policies, claims, payments, and customer service. It’s the central hub for data flow, connecting front-office and back-office functions. The CPS:
- Includes PAS functionality for the policy lifecycle.
- Automates claims adjudication, payments, and fraud detection.
- Manages billing and payments with advanced invoicing, collections, and reconciliation capabilities.
- Provides real-time data insights for reporting, compliance, risk modeling, and decision-making.
- Integrates with third-party systems and data systems.
The CPS may also be cloud-based and/or configurable.
The Difference Matters
Even if Property & Casualty insurers only faced volatile risks and regulatory demands, a PAS might be over its head. Add speed-to-market, efficient claims adjudication, an optimized customer experience, and enterprise-wide digital transformation, and a CPS is the only way to get there.
If you’re evaluating vendors, consider your scale. Then consider our Aspire suite. It contains capabilities for:
| Underwriting | Rating |
| Quoting | Issuing |
| Binding | Recording |
| Reporting | Premium Accounting |
| Digital Asset Management | Workflow |
| Financial Reporting | Compliance Management |
Yeah. You can get all that out of our system. That’s why we built it.
Let us know how we can help you with your tech upgrade.