AXA, Ping An and Allstate are transforming their businesses so they can capitalize on the disruption that’s shaking the insurance industry.

Successful disruptors deliver substantial innovation in the products and experiences they offer. They break down the barriers to entry that have long-protected markets and overcome the defenses of the incumbent suppliers. What’s more, they curb the prices of their offerings by paring costs throughout their organizations. Our research shows that disruptors invest more in innovation than their conventional competitors; focus on systems rather than just technology; scale innovation across their enterprises; and ensure that new systems are boundaryless, adaptable and incorporate both human expertise and the capabilities of intelligent machines.

Three big carriers are transforming their businesses.

In the insurance industry three big carriers, in particular, are overhauling their businesses and transforming themselves into powerful disruptors:

Ping An: This Chinese financial services giant is one of the most vivid examples of an insurer becoming a big disruptor. The company recently transformed its brand tagline to “Ping An – Finance & Technology” to stress the strategic importance and value of its investment in technology. Since 2017 it has been expanding its business to become a major international financial services and technology provider. It plans to spend US$15 billion on key technologies in the next 10 years to achieve this goal. Ping An’s transformation strategy currently focuses on three core technologies—artificial intelligence, cloud services and blockchain. The company has developed five major ecosystems—financial services, healthcare, automotive services, real estate transactions and smart-city services. To support its technology innovation and development, Ping An operates eight research institutes and close to 50 research labs that employ more than 30,000 people. It boasts a combined total of more 100,000 technology employees. The company is scaling up a variety of new technologies across all of its major operations. They range from AI-based agent interview systems, to intelligent business assistants and policy issuance applications to text-reading robotic processes. It is also ramping up big AI-based cloud services for massive data users such as automotive manufacturers and dealers. The company’s Global Voyager Fund, valued at US$1 billion, invests in emerging fintech and healthtech firms around the world while Ping An Ventures supports early-stage start-ups.

AXA: This French-headquartered multinational insurer has invested more than €1billion in the past five years to accelerate innovation in its business. It is transforming itself from a traditional insurer, which helps customers mitigate potential losses, into an extensive financial services organization. Key areas of focus are healthcare, mobility, the platform economy and business-continuity services, such as cybersecurity, for small- and medium-sized enterprises. Innovation partnerships are at the heart of AXA’s transformation strategy. Early in 2019 it formed AXA Next to build new services and business models that extend its business beyond insurance and foster partnerships. AXA Venture Partners, the company’s venture capital arm, has an investment fund of €600 million and is already supporting around 40 start-ups. AXA has also opened innovation labs in San Francisco, London and Shanghai and start-up incubators in London, Paris and Tel-Aviv. The insurer is fostering further innovation partnerships through AXA Partners. This subsidiary helps large organizations improve the experiences they provide their customers. Supporting AXA’s drive for new business opportunities is its AXA REV unit which researches and develops emerging technologies.

Allstate: In the US, Allstate has begun an extensive digital transformation of its business. The company aims to improve product distribution with advanced diagnostics, better customer segmentation and optimized marketing; enhance its operations by using data science and behavioral analytics to bolster customer service; digitize its claims processes by introducing real-time compensation; and upgrade its telematics services to offer usage-based insurance. Allstate is also looking to grow beyond insurance services by expanding business units such as its Arity telematics and predictive analytics firm as well as its InfoArmor identity-protection subsidiary, SquareTrade consumer asset-protection provider, and its roadside assistance operations. The company is also eager to grow its Allstate Benefits business. Arity is particularly interesting. It is using innovative data management technologies to store, interrogate and extract insights from the massive flow of around one petabyte of new information it gathers every month.

Critical to the transformation of insurance industry incumbents such as AXA, Ping An and Allstate is their strategic reallocation of funds. This allows them to invest in vital new technologies and business opportunities while also maximizing the performance of core assets and resources. We believe the most effective way to make this strategic shift in funding is to use a Wise Pivot approach. This allows companies to transform and grow their core business while also releasing capital to develop and scale up new business opportunities.

For more information about how insurers can capitalize on the disruption sweeping their industry, have a look the links below. They provide plenty of useful information. Alternatively, send me an email. I’d like to hear from you. 

Technology Vision for Insurance 2019. 

Future Systems. 

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