Partly predictions, partly wishful thinking, I hope you’ll be entertained—and stimulated—by what I think could happen this year.

First of all, welcome back and I hope you had an enjoyable, peaceful break with family and friends. I look forward to sharing my insights on the insurance industry with you, and to interacting with you over the various social channels—or maybe even face-to-face.

Here are some of the things that we might see this year, or that we could see if only somebody recognizes the opportunity!

  • We see the launch of the first pay-as-you-drive—or rather pay-how-you-drive—auto insurance in Europe, enabled by an app downloaded to the vehicle’s audio/ media system.
  • A big player cuts through all the connected car clutter and establishes itself as the owner of a network of connected cars—or, rather, the data from that network. When there is too much fragmentation, an industry is in danger of failing (Cecil Rhodes saved the diamond industry by consolidating all the players into De Beers.)
  • The ultimately counterproductive fashion for crafting elaborate “digital strategies” is replaced by integrated business strategies to meet the needs of empowered, online customers. Strategy is strategy!
  • A telecommunications company starts offering insurance (possibly context-based) on the fly through your mobile phone—smart emulation of microinsurance techniques. The big question here: what role will the insurance partner carve out for itself?
  • We see a big insurance company partnering with a building protection/ security network to take the concept of the connected home/ office to a new level—risk management delivered as a service!
  • We see MicroEnsure, BIMA or some other small-ticket insurance platform enter one of the big developed markets—the United States for choice. If that happens, I would expect to see them really giving the big players a run for their money as they apply intense customer focus and smart use of technology to delight customers. I predict a microinsurer could make headway reaching the large numbers of poor Americans (who are rich by Third World standards), as well as the more affluent.
  • A related possibility would be the sale of one of these leading small-ticket insurers to a non-insurance company (a telco maybe, or perhaps this is when Amazon, Google or a similar online player makes its move).
  • The big reinsurance companies start to venture further into the primary insurance markets.

Who knows, perhaps some of these might come true in the coming year. But tell me, what do you foresee for 2015—and why? I’d be interested to hear.

Meanwhile, very best wishes for the year to come: I’m sure we have some interesting times ahead!

2 responses:

  1. Here some of the trends I see or I partially wish might happen in 2015. However, I must say that most of my suggestions concern the European market especially in the German speaking countries where I have recently dealt mostly with.

    – A consolidation of European insurance aggregators: A major motor insurance company or a private equity fund continues to acquire smaller insurance aggregators in different countries to diversify the portfolio.
    – Google starting to show quotes between the adwords and the organic results making the role of the aggregators and the online insurance distributors redundant.(Try by typing for example “flight Barcelona” into the search field to see how it will approximately look like). In order to get access to the quotes Google might make their own negotiations with the insurers or most probably might acquire smaller local aggregators.
    – A major insurance aggregator from one country expanding into a neighbouring country.
    – A diminishing role of the insurance broker: customers are getting more self-educated about their own insurance needs.
    – Major retailers becoming affiliates of insurance aggregators.
    – An increase in the number of specialized aggregators in already relatively penetrated markets: an aggregator specialized for small business insurance, an aggregator specialized in pets insurance, an online comparison for health insurance only.
    – The new digitally savvy customer is getting more aware and educated about the importance of life insurance products: An increase in the number of life-insured customers under the age of 35.
    – Increasing role of mobile enablement in insurance products mainly for non-life products like travel and car insurance.
    – The increasing connectivity of customers enables for new innovative insurance models like the online peer-to-peer insurance. In the peer-to-peer insurance concept a group of clients (friends, relatives, a social media circle or an online group) saves from the premium by signing a collective contract. When there is no claim made to the insurer the premiums are reduced. So, in a case of a small claim the group will regulate it between each other financially and eventually save from the premium. In a case of a bigger damage a claim is made to the insurer but the group members will pay more for the premium by the end of the year. Successful examples are Friendsurance in Germany and Guevara in UK with a tendency for the model to expand to other countries.

    1. Thank you for your comments, Diana! Certainly your expectations / wishes are good ones and seem to be based on good insights..

      A number of your observations—in particular, those relating to increasingly savvy young consumers and the growth of mobile enablement for insurance products—can be corroborated in Accenture’s findings as detailed in our Digital Insurer survey (“Seizing the opportunities of digital transformation”). We find that both on the life insurance and property-casualty sides, insurers are increasingly falling into two camps: Digital Transformers and Digital Followers. The Transformer insurers are leaders in digitalization, and the trends you’ve outlined are for them terrific opportunities to expand their customer base and enhance profitability. It’s interesting to note that these digital leaders are keen on acquiring or establishing relationships with innovative companies or start-ups to acquire new digital capabilities, thus positioning themselves favorably in the digital world. You can find out more about Digital Transformers at http://www.accenture.com/digitalinnovationsurvey. Amidst the usual uncertainty surrounding the vagaries of the insurance market and the blank slate of a new year, I think we can all agree that 2015 will bring more opportunities to those players that are prepared to compete in the digital world.

      It is my personal hope though that consumers will increasingly wake up and use their power and request more transparency, more serivce, more customer first behavior – after all I truly believe that is the only real trigger that the industry may / will understand over time…

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