Some of the world’s interesting companies are making moves that are likely to have a big impact on the insurance industry.
Apple, AliveCor, Coinbase, Teladoc and HaCon, to name a few, have launched innovative products and services that could seriously disrupt the insurance business. As I mentioned in earlier blogs, insurers need to be alert to the threats and opportunities posed by these developments. Slow reaction to new market trends can easily result in missed opportunities or the rapid erosion of established business. While some of those innovations may pass by like distant thunderstorms to be watched from a beautiful beach (like I currently experience in Bodrum, Turkey), others may stay and change the industry fundamentally. Unfortunately I can’t predict the future and so we will only see over time…
The latest edition of the Accenture Innovation Series, a six-monthly review of innovation in the global insurance industry, identifies developments at some of the world’s smartest companies that could cause some thunder in the insurance sector. It takes a close look at the firms the Massachusetts Institute of Technology (MIT) recognizes as the world’s 50 smartest companies in 2015. What it discovers is a real eye-opener.
Apple – The Apple smart watch and Apple Pay digital wallet are likely to have a big influence on the health insurance business. Already insurers such as John Hancock, AXA and Allstate have launched services that incorporate the Apple Watch and many others are likely to follow. Apple’s digital wallet could also be used by insurers to reward customers with cash-back payments for healthy lifestyles.
AliveCor – This U.S. firm makes heart monitors that can be connected to Apple iPhones. It claims that its smart monitors have already recorded two million electrocardiogram readings. The product is a great fit for life insurers. Generali and RBM in Italy, U.S. firms John Hancock, VSP Global and Sureify, as well as Manulife in Hong Kong have incorporated smart wearable devices into life insurance products that track and reward healthy living. The trend will increase.
Coinbase – PayPal, Dell and Expedia are among the companies that use Coinbase to take Bitcoin payments without having to hold the cryptocurrency. American Century Life Insurance (ACLI) is accepting premium payments in Bitcoins. Other insurers may soon follow and could pay claims, as well as accepting premiums, in the cryptocurrency.
Teladoc – Around 10 million Americans use Teladoc’s remote health consulting service. While some healthcare organizations oppose telemedicine services, such facilities seem set to grow. Life and health insurers may soon embrace telemedicine operators, such as Teladoc, to cut expenses and reduce the cost to customers.
HaCon – The German company has developed an app that lets travelers draw on information about taxis, car rentals, bike sharing and public transport when planning journeys in Europe. A staggering 40 million journeys are planned on the system every day. Allianz and AXA are already encouraging customers to use ride-sharing services. As the sharing economy picks up, a growing number of insurers will launch products and services that address this market.
These smart companies are forging new markets in the digital economy. They provide an insight into the huge opportunities awaiting innovation insurers. They also sound a warning to insurance companies slow to recognize the pace and power of the digital revolution that is sweeping all industries.
In my next blog I’ll highlight some of the smart insurers that have seized the potential of the Internet of Things.