Insurance has traditionally
been an insular industry,
relatively unaffected by
what goes on outside the
industry. Of course, factors such as catastrophes
or market conditions have
an effect on insurance, but
in terms of fundamental
changes to operations or
the business model, insurers tend to lag behind the
developments taking place
in other sectors.
To some extent, this
has been by design and
that’s perfectly logical due
to the nature of the business. Insurance companies
are in it for the long haul,
and offer products with
the promise of a potential future fulfillment.
Until recently, insurers have not had any desire to change
rapidly in reaction to outside forces. Doing so would be a challenge anyway, due to the regulatory regime and the need to have
vast amounts of loss histories to support the creation of new
products. The winds of change are stirring and today’s headlong
sprint into the digital, connected world demands that insurers
build capabilities for more rapid change. Now, more than ever,
it is vital for the industry to look at other industries and societal
trends to spot new ideas, enable innovation, and reposition
their companies for future success.
Insurers should examine three areas to gain a better understanding of evolving customer expectations and to find sources
for new ideas. First, observe how customers interact with companies in other industries to learn what is influencing customer
Second, explore what is happening in the startup space, for
both insurtech and other new technology companies.
Finally, assess innovation outside of insurance. How are
companies in other industries approaching innovation and how
can insurers leverage what they are learning?
Customer Experiences Outside Insurance
There is no question that customer expectations are consider-
ably different than they were 10 years ago. This does not apply
only to P&C personal lines or L&A individual customers.
Business customers also have raised expectations. The individ-
uals that work for those businesses are influenced by their own
personal experiences, and the technology now used to interact
in a B2B environment has also significantly improved.
The question, then, is what do customers have in mind
as “the excellent customer experience” when they are dealing
with insurers? At each phase of a typical insurance lifecycle, the
customer may be comparing their insurance experience with
an outstanding experience they recently had with a different
type of company. This causes the bar to be set even higher for
Pulling Back the Curtain
Insights and good ideas on technology can be found from other industries.
By Mark Breading
The winds of change are
stirring and today’s headlong
sprint into the digital,
connected world demands that
insurers build capabilities for
more rapid change.