Other parts of this series:
How the post-digital era will impact your business
Accenture’s new Technology Vision for Insurance report outlines the key trends that will have an impact on insurers over the short to medium term. In this series, I have defined the post-digital era, discussed how insurers can build business models that thrive in this context, and have given pointers on how you can pivot your business towards ‘the new’.
With this framework in place, let’s analyze the trends themselves, and unpack their relevance to insurers.
Trend 1: DARQ Power
DARQ refers to distributed ledger technology, AI, extended reality and quantum computing. These new technologies have the potential to spark a paradigm shift for insurers, changing the entire industry and its role in the world. Seventy-one percent of insurers we surveyed agreed that the combination of all four DARQ technologies will be transformational or bring extensive change to their business, and 93 percent stated that they were already experimenting with one or more DARQ technologies.
Each of the technologies is at a different point on the adoption curve, but their ability to enable differentiated products and services is already evident. The key to using them effectively is experimenting and assessing your business’s readiness for these technologies, and then pivoting wisely.
Trend 2: Get to Know Me
When we asked insurers if they were using technology to build more flexible and valuable services or products that boost the frequency or quality of customer engagement, 60 percent were already executing new strategies and 35 percent were planning to do so in the next year. The trend towards personalization enables insurers to unlock unique customers and unique opportunities.
Over 80 percent of respondents in Accenture’s 2019 Financial Services Consumer Survey said that they were willing to share more personal information with their bank or insurer in return for benefits such as lower pricing, priority service, or more personalized service. With an increase in tech-driven interactions, including the use of wearables, insurers can create individualized experience-based relationships and assume the role of a risk coach or lifestyle advisor. This creates a new level of understanding of the next generation of consumers, generating insights that can be interpreted directly within the business. Eighty-four percent of insurance executives believe that consumers’ ‘digital demographics’ are becoming a more powerful way to understand their organization’s customers.
Trend 3: The Human+ Worker
Insurance workforces are changing, with employees becoming empowered by an evolving skill set and a new set of tech-driven capabilities. This shift is compelling insurance CEOs to adapt their technology strategies to support a new way of working in the post-digital age. Seventy-six percent of insurance executives agree that their employees are more digitally mature than their organization, resulting in a workforce ‘waiting’ for the organization to catch up. Thankfully, through AI, extended reality (XR), people analytics and modern collaboration platforms, insurance leaders now have the tools to drive meaningful change.
Trend 4: Secure Us to Secure Me
Connected, ecosystem-driven insurers are able to deliver best-in-class products, services and experiences. Fifty-nine percent of insurance executives said that they are forming distribution partnerships with non-traditional partners to reach customers in new ways and create new value for them, while 34 percent said they were planning on doing this within the next year. However, the introduction of new partnerships may come at a risk. The moment a third-party enters the ecosystem, there is a danger that an insurer’s security could be breached and that the carrier will absorb the vulnerabilities of its partners.
Leaders recognize that just as they collaborate with their business partners to enhance their offerings and experiences, so their security groups must collaborate to protect the ecosystem. This is a priority for insurance companies, as only 26 percent of insurance executives say they know that their ecosystem partners are resilient and compliant when it comes to security.
Trend 5: My Markets
In the post-digital age, customers will expect customized, on-demand experiences. Thanks to increasing digital access to customers, and powerful, real-time analytics capabilities, insurers are poised to offer multi-faceted value to their customers and respond to each opportunity as if it were an individual, momentary market.
Although insurance companies already perform demand planning and forecasting on a large scale, there is the potential to improve the granularity of their projections through the use of AI. Ninety percent of the insurers we spoke to agreed that the integration of customization and real-time delivery will be the next big wave of competitive advantage.
A digitized organization is the platform on which all innovation rests. However, pivoting your business towards its inevitable post-digital future is a task that must be undertaken wisely. Forward-thinking insurance leaders will strike the balance between doubling down on using digital technology to simplify core insurance processes and drive efficiencies while turning a strategic eye toward the future. For more insight on post-digital trends, read the full report here, and if you would like to pivot your business to thrive in this new era, get in touch.