Compete, collaborate, consolidate. Innovative tech start-ups muscled their way into the financial services industry a few years ago as aggressive competitors to long-established corporations. During the past year or so we’ve seen these fintech firms increasingly collaborate with big insurers and other financial services providers. They’re sharing their technology, expertise and business models in return for vital funding, market reach and industry knowledge. Expect 2017 to be marked by widespread consolidation among fintech start-ups – including insurtech firms.
Accenture’s most recent Global Distribution & Marketing Consumer Study asked nearly 33,000 consumers around the world how they buy insurance, what they want from insurers, and where digital connectivity and cognitive computing can increase the insurance value proposition.
Today’s life insurers face pressure to reinvent their businesses on many fronts. They must keep pace with rapidly shifting technologies, competition, regulations, risk typologies, and customer expectations. This year’s Technology Vision for Insurance—Accenture’s annual global survey of industry leaders—revealed that this feeling is widespread. Over 80 percent of the executives surveyed agree that their organizations must innovate at an increasingly rapid pace just to maintain a competitive edge.
Insurers need to move quickly to fend off rising competition in their traditional markets and to seize new business opportunities. Many carriers, however, are likely to stumble. Their business strategies are out of sync with the needs of their customers. And, their operating models are too cumbersome and inflexible to adapt to the fast-changing needs of their markets.
Will consumers allow a robot to guide them to which insurance coverage to buy?For many, the answer is “yes.” In fact, almost three-quarters of insurance customers report they are open to robo-advice for their insurance purchases, just over three-quarters for their investment-asset allocation and more than two-thirds for retirement planning. This willingness to accept computer-generated advice does not extend to every type of insurance, investment or retirement purchase. For more complex transactions and for complaint-handling, two-thirds expect first-class human interaction.
Tools and techniques can enable insurers to make better, faster decisions—but it means little if the corporate culture resists or is indifferent to changing the status quo. Joint research from Accenture Analytics and MIT shows that high performers not only use analytics differently, but also embrace the change journey. Let’s look at the research in more detail in this Insurance Insight of the Week.
Not that long ago, the world of insurance seemed insulated from the digital disruption that was sending shockwaves through industries like music, retail, and advertising. It was considered really forward-thinking and innovative for an insurer to experiment with digital ways of doing things.
For traditional insurance companies—some of which have been around for centuries—transforming into an Agile Enterprise is a herculean effort. Their legacies have been a source of strength; however, they can also be their Achilles heel. In this series, I’ve shared two key steps in the agile transformation journey: shifting the mindset of the workforce and the culture of the organization, and reorganizing people and technology to support iterative product development. Lastly, I want to discuss some of the missteps that await you on this journey. These common pitfalls can be grouped into three categories: people, process and technology.
If budgets and resources were not a consideration, every organization would aspire to be the one to beat, to be the company everyone is talking about or that offers the newest or fastest or most intriguing product. The entire organization – executives, professionals and support staff — would revel whenever the company’s name appeared in stories about forward-looking companies or products to watch.
Insurers looking to provide living services to increasingly digital-savvy consumers need to revise their traditional business models. They must shift from many of their conventional methods of attracting and servicing customers and become platform businesses that create value by collaborating with a host of partners and consumers.