Over the past decade, the insurance ecosystem has experienced significant changes. We have covered the significant change in consumers’ needs and preferences which is a result of easier access to information regarding their choices. On the other spectrum, rapid technological and digital innovations led by new technology-driven entrants are disrupting traditional financial and insurance services. Hence, insurance companies and agents are increasingly faced with the pressure to innovate and adopt digital solutions to optimize their operational methods and strategies. In particular, it is required for insurance companies to improve their customer experience, given the fact that the industry has the lowest consumer engagement and satisfaction rate when compared to other industries.
In the last few years, the view of disruption has started to gain a positive connotation rather than being perceived as a threat because insurance companies have begun to realize that insurtech startups can represent a source of competitive advantage. In fact, as of today, an increasing number of incumbents are open to partnership opportunities. In this respect, according to a recent survey published by Capgemini, at least 75% of the insurance companies interviewed are exploring partnership opportunities with insurtech startups to develop new solutions. The same survey has also highlighted the benefits of partnerships and collaborations, according to incumbents.
All of these suggest that technology is gradually redefining the entire insurance industry and, therefore, it is essential to promptly respond to the changes. Partnerships and collaborations can represent effective and proactive ways to complement capabilities and strengths while driving digital transformation. While insurtech startups have a better understanding and knowledge of the digital world, insurance companies are better equipped when it comes to insurance expertise, distribution channels, and institutional knowledge.
How can technology transform the industry landscape?
Research conducted by Capgemini has shown that technology can empower insurance companies and enhance business performance. It can be done by adopting advanced digital solutions to access and analyze consumer data at an integral level, which will allow insurance companies to offer tailored solutions to their consumers. At the same time, insurance companies can benefit by becoming preventers by offering risk prevention solutions and advice to their clients. The adoption of more efficient risk control strategies will contribute to claim reductions as well. Therefore, by extending their role as preventers and partners, insurance companies will be able to adopt a more customer-centric approach as a way to boost consumer experience while improving profitability and business performance.
Partnerships and collaborations can be from both within and outside the insurance industry. In doing so, insurance companies can increase their presence and participation within the customer journey. The integration of customer's information across a series of services will provide the opportunity to better understand the client’s needs and preferences while boosting customer interactions. For instance, insurance companies can partner with healthcare providers, which would allow both parties to access valuable information. As a result, insurance companies will acquire a better understanding of their clients in terms of habits and lifestyles and offer more personalized solutions. Healthcare providers, on the other hand, can use the data gathered from insurance companies to conduct research studies aimed to improve patient care.
This implies the adoption of an ecosystem-mindset based on collaborations and partnerships rather than considering the single industry on its own. Here at Insuree, we support the vision of building a large and inclusive ecosystem in which each player has an important role to play in terms of bringing new capabilities and expertise. We believe that players from different industries can join this ecosystem in order to boost each other’s strengths and ultimately contribute to improving people’s lives altogether!