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Insurance: digital transformation shifting from threat to opportunity
Until recently, insurance was one of the most disrupted sectors of the global economy. Many insurers felt threatened by new competition on the back of rapid technological change and shifts in consumer behaviour. But this trepidation is turning into optimism, and insurance CEOs now have fewer concerns about disruption.
Insurance is embracing emerging technologies. Of the insurance CEOs polled, 80% said that artificial intelligence (AI) was already, or about to be, part of their business model.
But technology investment is shifting from improving the customer experience and reducing costs to enabling new business models. A good example is the way a combination of sensors, AI and machine learning is helping the industry move towards more proactive risk detection, intervention and prevention.
The intelligent interaction at the core of new business models is taking customer experience and engagement to a new level. The nature of the relationship between insurer and insured, and even what we mean by insurance, is changing. This is increasing the social value of insurance.
The survey reveals that some insurers are much quicker than others to embrace the future and capitalise on the opportunities. The frontrunners are those that have moved innovation to the heart of their business. It’s also worth noting that Asia is the powerhouse of advances in insurance to serve a whole new, digital-friendly clientele. Despite the progress and the new positive attitude to disruption, insurance can go a lot further.
If you’re in insurance, there are various areas you can address:
- Reimagine the future − not just using digital technology, but working out what your business does better than any other.
- Choose the ecosystem you want to serve.
- Simplify legacy systems to drive efficiency and create capacity for growth.
- Focus on talent development.
- Accelerate execution: recognise data as your most crucial asset and adopt an agile approach to execution and change management.
As in asset and wealth management, the secret to success for insurers will boil down to harnessing emerging technology, 21st century talent and agile approaches to perfect new ways of interacting with customers, business and technology partners. If you’re looking for inspiration, keep an eye on what’s happening in Asia.
