In a previous series of posts, I reviewed some research done by Accenture into the state of innovation generally. That research included 32 insurance companies. Now I’d like to continue exploring the state of innovation in insurance more specifically. These posts are based on a point of view article I wrote about this research. Read the article, Innovation: The opportunity for insurers.
My co-author, Werner Rapberger, and I came to a conclusion that is perhaps rather surprising: the generally lackluster performance of insurers when it comes to innovation actually creates a huge opportunity for those companies that understand that innovation is no longer optional for insurers. Many factors are making it imperative for insurers to take a more proactive approach to innovation, and build it into their way of doing business.
Not that innovation is easy or something to be entered into without looking at all the risks. Insurers are conservative for good reason—risk is risk, after all, and acting as a safety net is a big responsibility. The innovation process, and the resulting ideas, products, services or even structures and partnerships, need to be exceptionally well thought out and the risks carefully calibrated, to ensure that a great idea does not prove a threat to the insurer’s long-term sustainability.
Broadly speaking, the factors that make it essential for insurers to innovate relate to consumers in general and insurance customers in particular, as well as the competitive environment in which insurers find themselves. In my next blog, I want to explore them in a little more detail.