The insurance sector is being disrupted at a feverish pace. Disruptive startups never just settle for improving the current way of doing things. Instead, they focus on rapidly changing the game entirely. There are no insurers exempted from this; as digital and new technologies are creating disruptive threats at every turn.
According to the “Pulse of Fintech” Q2 2016 report, recent venture capital-backed InsurTech investments spiked to $2.5 billion of investments in 74 deals in 2015, up from $700 million in 2014.
This disruptive force of the Insurance industry centers around three main topics: Customer relationships or demand, Risk mitigation, and Transformation.
Seamless customer centric omni-channel experience is the expectation throughout the customers’ journey: no matter whether the customer is doing initial research, finalizing their decision to buy, ordering services or considering changing their insurance policy.
Engaging with the customer regardless of method, at home, mobile or other can help insurers differentiate themselves. Customers can develop closer relationships with their insurance provider, and purchase the products they need when and how it’s most convenient for them.
IoT is fundamentally changing the way we assess and manage risk. While managing and understanding risk will never be an easy task for insurers, digitization is helping gain better visibility and insight into markets like never before. Most financial services executives list that cyber security is a top priority, yet less than 10% of companies have cyber insurance.
Insurers can gain better visibility into their customers’ risk profile, by partnering and leveraging technology insights. Using insight into large portions of the Internet, and applying non-intrusive threat analytics to develop a detailed risk assessment for specific industries and companies, can assist insurers tap into this cyber liability market.
The journey to find a business model which can leverage these new digital possibilities is more important than ever. As more and more customers transition to digital channels to make purchases and the emergence of interconnected ecosystems will be key drivers for business transformation.
Many companies have developed comprehensive digital strategies, but struggle to enable them. However, by creating a Digital Business Roadmap, companies can connect their IT and business strategies to enable key digital capabilities at faster pace. A well planned strategy, enabled by best practices and proven tactics is essential.
For more information on what Cisco is doing to help insurers handle this Digital Transformation: FSI on Cisco.com