Have you ever asked: “Why is it so hard to get things done around here?”
In the legend, Alexander the Great stopped trying to unravel the Gordian Knot thread by thread and found a bolder way through. Insurance leaders cannot cut complexity away overnight, but they can use a reinvention mindset to redesign how work gets done.
Imagine an insurer where it is easy to do the right work and nothing gets in the way. Decisions are clear, progress is visible and talented people can focus on creating value.
Across insurers, reinsurers, brokers and other intermediaries, complexity accumulates over time. Acquisitions are only partly integrated, regulation evolves and technology estates grow. Long-tail books, legacy policies, local market variations and multiple distribution models add layers. In life, retirement and pensions, decades of product history and servicing obligations add another back book dimension.
Complexity is rarely the result of bad decisions. Sutton and Rao describe the resulting burden as a “friction tax”: sensible additions accumulate until the organisation becomes harder to navigate, harder to change and harder to perform in.
Why simplification matters
Simplification lowers cost, strengthens risk and controls, accelerates change and improves service.
Costs fall sustainably when organisations challenge fragmentation, duplication, manual work, exception handling and unnecessary management layers. This goes beyond another annual cost “haircut”. It asks harder portfolio questions: which products, markets, processes, systems and meetings still earn their right to exist? What should we stop?
Simpler processes and cleaner data also improve decision quality, which is vital in underwriting, actuary, claims and reserving. Simplifying the decision environment gives experts more space to exercise judgement well.
For customers and intermediaries, simplification improves experience, removing repeated information requests and broken hand-offs, speeding up quoting, onboarding, claims and renewals.
Why being simple is not easy
Insurance carries inherent complexity. The principle of “requisite variety” matters: organisations need enough variety to match the complexity of the markets, clients and risks they serve (e.g. insuring a complex one-off infrastructure investment or event). In this context the goal is not standardisation for its own sake. It is to standardise the high-volume, high-control core while preserving differentiation where it creates value, wins business and retains clients.
Human behaviour works against simplification too. “Addition bias” means we naturally add rather than subtract. A new approval, committee, report, product variant or control often feels safer than removing an old one. This is particularly true when leaders work within their function, business or country, delivering well but creating duplication.
That is why reinvention matters.
Four ways to cut unnecessary complexity
- Lead as a trustee of people’s time
Ask what burdens can be removed from underwriters, claims teams, actuaries, brokers, advisers and operations colleagues. What consumes energy without improving customer, risk or business outcomes?
Make complexity reduction measurable: product variants, systems, forums, approvals, exceptions and hand-offs removed. Give leaders explicit ownership for reducing them.
At one large Asian insurer, product teams adopting modern engineering and agile delivery kept hitting organisational friction. Leaders created a cross-functional “broom squad” across IT, business, finance, risk, HR and procurement to remove blockers no single team could solve. Around 70% of the portfolio moved into a product-based model and change accelerated.
- Reinvent work to be simple, not just simpler
Redesign value chains end to end. Start from the future value you want to create, then rethink the work, workforce, technology and AI required to deliver it. Agentic AI in particular can be powerful to reinvent, automate and augment work, but it should not automate legacy complexity.
At one global insurer, we simplified underwriting work and reduced risk criteria by almost half before introducing agentic AI. Processing time fell from three days to about 15 minutes, review coverage increased from around 20% of broker submissions to 100%, and revenue increased by around 50%.
- Build an ownership mindset
Give people permission to retire legacy processes, remove redundant controls, fix root causes and make the organisation easier to navigate. Recognise subtraction as a brave behaviour and worthwhile outcome to be recognised and rewarded.
Small changes like the words we use can help. Insurance is rife with “jargon monoxide”: acronyms and specialist language that make already complex organisations harder to navigate. Clearer language, better onboarding and simpler ways of working help people understand the business, collaborate and take an enterprise view. As an example, at a major insurer we are developing their leaders, from the C-suite to value stream owners, to display enterprise mindset and individual accountability.
- Make every change subtract complexity
Insurance is moving toward continual change, with product and value-stream models emerging across much of the sector. These models can reduce complexity by anchoring persistent multi-disciplinary teams and funding around persistent priorities and value, rather than disconnected projects.
Make removal part of the definition of done. If you launch a new process, retire an old one. If you introduce a new control, remove redundant ones. If you deploy AI, simplify the journey and decision logic first. Transition states are essential in larger transformation but need to carry commitment not to leave a half-finished outcome. As an example, in our pensions admin operations for clients, as we apply waves of operational, technology and AI change, we are also simplifying things to improve service and efficiency.
All leaders can drive simplification changes. For instance, they can run cross-functional friction audits, prioritise the biggest blockers, remove them visibly and repeat. Treat simplification as a continual management discipline.
Cutting the knot
Across insurance, organisations that make it easier to get the right things done will be better placed to reduce cost and risk, change faster, serve customers and partners better, and create healthier places to work. This is amplified in a human-led, AI enabled era.
The ambition is simple: a new colleague, broker or customer should be able to ask, “How come it’s so easy to get things done around here?”
Where will you start?
