The next big competitive advantage in insurance will be created by the ability to capitalise on “momentary markets,” or personalised policy and service offers tailored to customers’ unique life moments and delivered in real-time, according to a new report from Accenture.
The report, Technology Vision for Insurance 2019, notes that we’re entering a new “post-digital” era, where digital is no longer a differentiating advantage — and now the price of admission.
The report notes that while the average insurance customer engages with his or her insurer only once or twice a year, insurers are looking to increase engagement through real-time risk protection and mitigation services.
Three in five insurers (60 per cent) are already using technology to build products or services that boost the frequency and quality of customer engagement, with another 35 per cent planning to so in the next year.
“There’s an opportunity for insurers to increase and improve their touchpoints with customers and forge a stronger, more personalised experience by harnessing customers’ digital footprints, but they’ll need to digitalise their core before they can reach these new heights,” said Daniele Presutti, who leads Accenture’s Insurance practice in Europe.
“Most traditional insurers are behind the curve in this ‘post-digital’ world, with a heavy reliance on mainframe technology. This makes it difficult for them to explore opportunities in the cloud and technologies such as AI to transform their operations, accelerate time to market and improve security. It also makes them vulnerable to the early adopters of these technologies as well as the nimbler ‘post-digital’ upstarts.”
Meanwhile, three in five insurers (59 per cent) are forming distribution relationships with non-traditional partners to reach customers in new ways and create new value for them. However only one-quarter (26 per cent) of respondents know for sure that their ecosystem partners are working as diligently as they are to improve their security resilience. Leading insurers will recognise that as they collaborate with entire ecosystems to deliver new products, services and experiences, security must be a priority.
The report also suggests that failure to master social, mobile, analytics and cloud (SMAC) technologies will leave insurers unable to serve even the most basic demands of a post-digital world and prevent them from embracing the next wave of digital disruption — distributed ledger technology, AI, extended reality, and quantum computing (DARQ). This new set of technologies will let insurers reimagine the entire industry and its role in the world.
“For insurers to excel in the ‘post-digital’ environment, they’ve got to become more agile and implement SMAC as a core competency before they can rotate to newer technologies, including distributed ledger technology and AI,” said Jim Bramblet, who leads Accenture’s Insurance practice in North America.
“They’ll also need to carefully choose the customised and on-demand customer experiences they want to target and work backwards to map out how to get there, determining which ecosystem partners they need and where their place in that ecosystem will be.”