Embracing insurance technology – this is the year…
The insurance industry seems reluctant to embrace change and technology. There is a proud tradition in the industry about the way we transact business and our focus on face to face interaction; after all this is the genesis of the London market’s reputation. The fear seems to be that insurance technology will remove the essence of our reputation, lead to job losses and bring about a whole host of negative changes. But we are in the midst of what some are calling the second industrial revolution and we need to change if we don’t want to miss out.
Technology has revolutionised the way we live. In less than a decade we have seen the advent of smartphones, tablets, apps to control your heating remotely and much more. We all make the most of these advances outside of work: shopping online, transferring money via mobile numbers and booking flight through apps, yet there is a reluctance to transfer this approach to business.
We need to adjust our mindset to understand the advances technology brings if we don’t want to be left behind. If we don’t then we are at risk of losing out on business, both to those already in the sector but others outside the sector looking to enter the market. Will Google enter the insurance market? Will you be able to buy insurance through Facebook? In February O2 launched its O2 Drive proposition, making it the first mobile company in the UK to offer car insurance, and companies such as Lemonade, Brolly and Friendinsurance are also entering the marketplace and disrupting the status quo. Technology is being applied to risk management and there we can expect to see many changes over the next decade in how we buy insurance (more so initially in the business to customer sector) and the insurance that we buy.
Technology brings huge operational efficiencies if we utilise it properly. Jobs that were previously done manually, like producing contracts and basic administrative tasks can be completed in half the time using software. This speed of response benefits clients as it means you can deliver a stronger, quicker and more efficient service. If you have a reputation for this level of service, it can deliver significant reputational value which will ultimately help attract more business.
Giuseppe Tomasi di Lampedusa famously wrote: ‘If we want things to stay as they are, things will have to change’ and this has never been more true in our industry than now. People like familiarity but we need to encourage a new mindset in the industry – one which embraces insurance technology and the idea that there is a more efficient, faster way of doing business. We need to promote the significant advantages that technology will bring to the insurance industry to ensure we don’t miss out on business and to ensure that, at the very least, we keep pace with the innovation taking place.
By Mayo Oshin