The finance and insurance industry has pushed ahead with digitalisation in recent years and successfully introduced digital processes and technologies. However, many companies are still in the process of integrating digitalisation into their business strategy and modernising their IT infrastructures. This is shown by our study "Cloud transformation in the finance and insurance sector". To this end, we surveyed managers and specialists, particularly with a technical profile, from the sector and can now provide information on the progress that has been made in implementing cloud services and where companies still have some catching up to do.

A core element of the digitalisation strategy is the migration of workloads to the public cloud, for example in order to be able to develop processes more quickly and flexibly. Other arguments in favour of introducing the cloud include cost savings and IT security. Above all, employees from traditional insurance companies see the most important advantage of public cloud computing in the ability to adapt IT resources as required. They see this as a starting point for customising services and technologies to their own needs.

As in many other industries, cloud computing continues to be one of the major trends in banking and insurance and has already become the cornerstone of digital transformation in many institutions. As high data protection and security standards apply in the financial sector, most companies rely on a mix of legacy, on-premise, private and public cloud structures. Many public cloud providers have now responded to the increased demand from the financial sector and offer cloud services that are customised to the high security requirements of financial and insurance institutions.

Our survey shows that many companies have already integrated cloud services into their processes. On the other hand, the majority of respondents, namely 71 per cent, have shifted less than half of their workload to the public cloud. This is particularly true for traditional companies. The reason given is usually a high migration effort. The respondents we surveyed plan to increase the proportion of their workloads in the cloud in the coming years.

Security concerns play a major role in the use of the cloud in the finance and insurance sector. Many respondents are worried about losing their own data. Legal hurdles also pose a challenge for almost half of those surveyed (44 per cent) when it comes to cloud transformation. The protection of sensitive customer data plays a particularly important role for the industry. The regulations for preventing possible data misuse are exceptionally strict compared to the rest of the industry and a loss of trust on the part of customers in the event of damage is particularly serious.

The survey also shows that companies whose cloud transformation is not yet so far advanced underestimate the tasks ahead. Companies that already have a large part of their workload in the cloud are more likely to see hurdles to sustainable implementation than employees from companies with significantly less transferred workload.

Companies in the finance and insurance sector are increasingly confronted with growing challenges and changing market requirements. Customers expect constant accessibility across all channels, customised service offerings and simple, digital processing of financial services. At the same time, new platform-based business models are developing, additional competitors are entering the market and digital online banks and insurance companies are benefiting more and more from a direct interaction interface with their customers. Traditional IT architectures can no longer fulfil these requirements. For this reason, cloud technologies have also become the cornerstone of digital transformation in the banking and insurance sector. The question is no longer whether, but how companies use the cloud.

The study "Cloud Transformation in the Finance and Insurance Sector" was designed and conducted by the research and analyst firm techconsult on behalf of KPMG. A total of 200 employees from German financial and insurance institutions were surveyed. The respondents included managers as well as IT specialists and employees responsible for app and software development.