Reimagine Insurance: By Jessica Lipnack It’s relatively easy to pick apart an organization or company and say that this division or that has not embraced innovation — or done it the right way immerse yourself in an organization or company and recognize that this or that division has not committed itself to innovation — or done it right — here are five offered strong suggestions:
Insurance based on its sociopolitical context and technological advancement stands at a crossroads due to the dynamic market trends and changing tides in customers’ needs. As a result, the insurance industry must adapt to innovation and transform its original organizational structures. Here are five keys to driving innovation in the insurance sector: Here are five keys to driving innovation in the insurance sector:
1. Embrace Digital Transformation
In its current form, digitization is no longer the strategy of choice, it is a mandatory instrument for any insurance company that looks to compete. This includes the reliance on modern concepts like artificial intelligence, machine learning, blockchain, Internet of Things among others. Such technologies contribute to the efficiency of operations and the improvement of customers’ experiences and added value.
AI and ML can be used to analyze large quantities of information which will enhance underwriting profiles, identify fraud cases, and enhance customer relations. The use of blockchain technology by insurance firms can help in cutting on fraud incidents and also make the processes of transactions and claims more efficient. The elements of IoT technology for example smart home sensors and wearable health monitoring devices allow insurers to acquire updated data on risk that helps them to design new products better.
2. Focus on Customer-Centricity
Customers today’s generation have some specific behaviors toward a company and their self-expectations, especially in the digital world. In insurers’ business model transformation, a customer-centric orientation has to be adopted, where the customer is at the center of all activities. This is the awareness of the needs and wants of customers and it entails creating solutions that will suit the needs of the customers.
This can be done in various ways among them being the application of data analytics. A look at the customer information means that the insurers can be able to know more about the customers hence being able to sell to people according to their wants and needs. Further, insurers must ensure that they develop and maintain functional technologies that can support the customer experience in engaging with the company- from the policies’ purchase to the claims process.
3. Inspire Creativeness
Insertion of innovation should become a part of the organizational culture of an insurance company. This entails culture change with a focus on innovation and learning organization. The insurers should ensure that the culture of the organization supports creativity and that the employees are free to come up with new innovative ideas and also free to take risks for the benefit of the organization.
Now to understand AD easily one of the ways of building a culture of innovation is through collaboration. A suggestion can be for those insurers to have innovation labs/centers of excellence where like minds from various departments come up with new ideas and undertake emerging projects. Also, insurers need to embrace collaborations with insurtech startups, IT suppliers, and other related companies and actors to introduce ideas and approaches.
4. Leverage Ecosystems and Partnerships
The industry becomes more connected with insurers, insurtechs, technologies, and other members of the ecosystems. These ecosystems will enable insurers to obtain newer technologies and enhance their customer reach using these ecosystems, the insurers benefit from agile technologies, more distribution points, and improved product and service propositions.
This occurs through what can be referred to as strategic partnerships. For instance, payment services can be offered through collaborations with fintech firms should insurance companies want to include the service on their platforms. They can also partner with health tech companies to include wellness programs and preventive care services that can complement health insurance.
5. Adapt to Regulatory Changes
The insurance industry operates within some of the most strictly regulated environments in the world owing to the fact that the industry exposes consumers to various risks. Insurance providers must monitor the evolution of such ailments and the importance of adhering to as many policy provisions as possible.
This needs a compliance agenda as well as a proactive attitude to matters of regulation. Insurers should decide on appropriate regtech solutions to use for the tracking of the changes, their analysis, and the subsequent implementation of the relevant changes by the insurer. Furthermore, insurers can participate in discussions with regulators and the industry bodies that create new regulations in order to be updated on future changes.
Conclusion
The idea of innovation is not limited to embracing new tools and equipment; on the contrary, it encompasses revamping the insurance value network. The tangible strategy is based on the following pillars: digital transformation, customer-centricity, the culture of innovation, ecosystems, and partnership, and regulation change to meet the needs of the changing market for insurance services.
However, as seen, the process of getting to innovation is not an easy one but the gains at the other end of the process are well worth it. To sum up, insurers that find their way through this process will be ready to meet new customer demands have proper tools to consider new risks, and attain future growth. Labels and conventions have no place in the next world of insurance that is waiting for those who will be brave enough to dream and build it.
