Other parts of this series:
- Innovate or downscale: the insurer’s dilemma in the digital economy
- It’s time to challenge the old orthodoxies that are stopping insurers from becoming innovators
- Here’s how insurers can transform themselves into innovators
- These digital technologies need to be on the watch-list of every insurer
- Insurers must learn the golden rule of innovation – collaboration is crucial
- Experience required: Insurers need to delight their employees as much as their customers
The insurance industry is poised to be disrupted by several powerful digital technologies. Insurers need to determine how they’re going to employ these technologies to foster vital innovation.
Increasing competition from big digital service providers and nimble start-ups is forcing long-established insurers to overhaul their business strategies. Attempts to mimic their new rivals by introducing similar digital offerings, however, are not enough. Insurers need to innovate. They must use emerging technology to create innovative products and services that will delight their customers, open new markets and drive revenue growth.
The recent Digital Insurers Network (DIN) gathering, convened in Paris by Accenture, identified some of the key technologies, and associated trends, that will disrupt the insurance industry in the next few years. These technologies should be on the agendas of all major insurers. Carriers need to determine how they’re going to employ them to foster innovation. Also, they must to decide how they’ll respond when their rivals, or partners, bring these technologies to market.
Critical technologies identified by the DIN include:
Blockchain: Prospective blockchain applications range from distributed ledgers and smart contracts to digital currencies, the verification of goods and transactions, and identity authentication. The onset of blockchain services will realign at lower costs of operations relations between insurers, brokers, re-insurers and banks and encourage “co-insurance” partnerships where several parties share risks and rewards. We had to the opportunity to discuss with Leanne Kemp, CEO of Everledger a company already offering live blockchain services on how new type of service will come to life
Data security: A multitude of products and services are emerging that will help insurers better safeguard valuable data and respond to security breaches. Cyber-attacks on insurers and other organizations are rising fast and becoming more threatening. Insurers’ relations with customers and partners, as well their standing with regulators, will hinge on their ability to protect information and use it ethically.
Workforce automation: Many insurers have automated routine back-office tasks to improve efficiency and productivity. The powerful combination of AI and Robotics Process Automation will increasingly be applied to support insurance workers and help them make swift and effective decisions and allow them to concentrate and client relationships and new services vs routine tasks. Automated “co-workers”, that provide advice and quickly source information, will become commonplace at big insurance firms where they’ll support sales staff and advisors.
Virtual and augmented reality: The ability to invite employees and customers to engage in virtual environments will provide insurers with a multitude of opportunities. Staff training, coaching and development will change dramatically as well as potentially customer engagement as the current Pokemon Go craze vividly shows. Sales and support processes that use virtual or augmented reality will become the norm and offer a wealth of new powerful sales and risk assessment dialog possibilities.
Data visualization: The use of sophisticated data analysis technologies to synthesize vast volumes of analytics data in stunning visual displays will become a powerful medium of communication. It will enable insurers to improve considerably their training and marketing.
Cloud and mobile: We discussed with Scott Walchek, CEO of Tröv how the combination of mobile and could can create a “cloud for your things” letting you insure the things you love, exactly when you want just from your phone. Obviously this concept can be broadened, image insuring your home with GPS or map location, auto insuring your car using VIN as well as searching a product database to add items.
3D printing and scanning: The proliferation of 3D printing will force insurers to accommodate this innovative technology in the cover it provides customers. Liability and risk will often need to be reassessed.
In my next blog post, I’ll comment on our discussion at the DIN on an important feature of innovative organizations – partnerships.
If you would like to learn more about the DIN, please email firstname.lastname@example.org.