These are a few steps insurance business and IT leaders must take as they prepare for the technical, operational and cultural aspects of cloud adoption:

Conduct a cloud-readiness assessment: You won't know where you're headed if you're unsure about where you're starting. The first phase of any cloud migration effort is to take full stock of the applications your organization currently runs (on premise or otherwise). A cross-functional team of subject matter, IT and platform experts should be involved in order to illuminate to what extent each application is used and who uses them, any interdependencies between applications and specific regulatory or security standards they must fulfill. From here, you can begin classifying applications based on ease, cost and time to migrate.

Develop a proof of concept: Smart insurance leaders will approach cloud adoption like a pool of ice water: if you dive in, you'll shock your system, but if you go in slowly, your body can adjust. To earn internal buy-in for such a contentious move, it helps to have a successful case study under your belt. For instance, once your readiness assessment is complete, the next step may be to pilot migration with a non-mission critical application (one that isn't deeply intertwined with other programs). The same logic applies to insurers attempting to establish new, born-in-the-cloud workloads; rather than deploy a batch of new cloud-based applications, test one to ensure it's fully compatible with your existing mainframe system.

Prioritize personnel: Though a large contingency of baby boomer mainframe experts is gearing up for retirement, many aren't ready to leave the workforce just yet. As insurers shift more workloads to the cloud, they need a strategy for engaging their mainframe gurus. Before and throughout the adoption process, these subject matter experts can offer invaluable insight into integrating on premise and cloud-based applications, and best practices for managing a hybrid environment. There may also be opportunities to retrain mainframe experts on cloud technology and support, helping evolve their skills to match your increasingly digital business needs.

Insurers are not going to rip and replace their mainframes overnight. Big iron will continue to play an important role in insurance organizations' IT operations. But if the industry hopes to overcome its current cost and competitive challenges, business leaders will need to forge an environment where the cloud and mainframes can coexist.

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