Insights Customer Communications & Experience
The Digital Insurer – Evolution or Disruption?
The rapid transformation of consumer behavior and digital technologies drives change across every value chain in every industry. The pace of change clearly differs across industry verticals; however, none, in the long run, will be immune to the expansive amounts of capital being deployed to transform traditional businesses digitally. In a not too distant future, where every transaction is conducted through a personal computer, mobile device, digital assistant, or self-aware robotic butler, every business will need a digital transformation strategy in order to compete and thrive in a fully digital economy.
A natural question arises, will the digitization of Insurance be disruptive or evolutionary?
The simple answer, based upon the structural regulation of the Insurance markets in most jurisdictions, suggests an evolutionary path. In fact, the content and context of two large insurance industry digital events in the past year, Insuretech Connect and Dig|In, leaned heavily towards meaningful, but incremental and evolutionary adoption of digital technologies. Hundreds of speakers on dozens upon dozens of panels, all specialists representing, in their entirety, the breadth of the Insurance value chain, in both property and casualty and life and health, hypothesized and described the real opportunities, benefits, and risks, to insurers resulting from digitization. These evolutionary steps are by no means trivial, and quite transformative, but the prevailing hypotheses all considered the continuity of the Insurance company as it exists today as a fundamental given.
What does the future of Insurance look like without Insurers as they exist today?
The most valuable digital companies today fundamentally derive their market value from their platform business model. Amazon, Apple, Facebook, Google, and Netflix build platforms of services allowing for near systemic coverage of digital needs and harvest the data from their platforms to develop and deliver new services to engage more consumers. It doesn’t take a vivid imagination to picture these platform companies evolving into risk management firms for their customers in a much more intimate and transactional nature. The tech giants represent the opposite of modestly funded insuretech firms biting off a small piece of the value chain, such as digitizing a component of the claims process; firms like these have the capacity to disrupt the entire insurance value chain in short order. Yes, they’ve sniffed the market before. Yet, consider new delivery model experiments such as the announcement from JPMorgan Chase, Amazon and Berkshire Hathaway to form a joint venture to reduce health care costs. Moreover, consider the wave of announced mergers creating new service paradigms in the health sector since December 2017, including the CVS buyout of Aetna and Cigna acquiring Express Scripts. These new, highlight emerging paradigms that create opportunities for massive disruption.
Insurers must find a digital transformation path in order to thrive in the future, but many insurers struggle with how to get started. Celent and SSQ Insurance shared their insights during a recent ‘Digital Disruption meets Customer Experience’ webcast which was hosted by Symcor.
Symcor delivers digital transformation with a focus on the customer experience at scale, enabling companies to unlock their full growth potential and maximize efficiency.