The insurance market is facing a seismic shift where collaboration is set to become more important than ever.
This is needed to meet rising customer expectations, according to the World InsurTech Report 2019, published by Capgemini and Efma.
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Four main shifts in the market were highlighted:
- Moving from a product focus to customer experience: 70% of insurers and insurtechs said a focus on holistic risk solutions for customers was critical in moving the insurance market forward;
- Data as an asset: more than 70% of insurers and insurtechs said advanced data management was critical;
- Transition from asset ownership to a shared economy: more than 35% of insurers and insurtechs have already realised that focusing on shared ownership of assets is crucial, and
- Partnerships rather than the “Build or Buy” approach: 90% of insurtechs and 70% of incumbents stated that they want to work with one another.
“As the insurance marketplace evolves, insurers will move beyond their traditional role as payers covering customer losses to partners that identify and forecast risk, helping with insurance and related non-insurance needs,” said Anirban Bose, CEO of Capgemini’s Financial Services Strategic Business Unit and Group Executive Board member.
“To deepen customer relationships, insurers will have to collaborate more with insurtechs who are already mastering the customer experience by leveraging the most innovative technologies and use of data.”
Findings from the World InsurTech Report 2019
Digital maturity was a fundamental part of the report, but it found that aspirations rarely met reality.
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By GlobalData79% of insurers say advanced data management capabilities are important, but only 37% has a digital transformation strategy in place.
In addition, over a third (37%) stated shared ownership of assets was important, but only 11% were leveraging open architecture.
Furthermore, 69% of insurers believe that partnerships are critical, but only 32% are collaborating with ecosystem partners. This is despite working together being the best method to suit everyone’s goal. Fewer than 60% of incumbent insurers want to build infrastructure for open collaboration and more than 60% of insurtechs wish to work with insurers to create such a foundation.
