Advanced technologies ‘transforming insurance’
Written by Anthony Strzalek
Advanced technologies such as blockchain, drones and connected devices are now becoming the norm for insurers rather than the exception, new research has revealed.
The Capgemini and Efma report shows that a wave of new digital technology is confronting most insurance sectors.
Of the more than 8,000 consumers surveyed worldwide, nearly one-third (31 per cent) of customers said they rely on InsurTechs either exclusively or in combination with incumbent relationships to access insurance services. Respondents also said InsurTechs have earned a reputation for better value for money and timely, efficient service.
On the whole, however, customers are not ready to walk away from the ties they have long had with incumbents, citing security and fraud protection (46 per cent), brand recognition (44 per cent) and personal interaction (42 per cent) as areas in which incumbents performed better. In addition, 40 per cent of customers said they trust their insurers, compared to only 26 per cent who trust InsurTechs.
Insurers agree that the complementary strengths of InsurTechs and incumbents form a solid case for collaboration. In fact, of the more than 100 senior executives interviewed from various insurance firms in 15 markets, a strong majority (75 per cent) said that developing InsurTech capabilities would help them better meet customers’ evolving demands. And more than half (53 per cent) agreed that having InsurTech capabilities would help them quickly design personalised products.
Jack Dugan, executive vice president and head of insurance at Capgemini, said: “Increasingly, partnerships are being viewed as a welcome development in the ongoing effort to address the InsurTech movement.
“InsurTechs can help incumbents overcome roadblocks such as aging systems and paper-based processes. Meanwhile, incumbents can help InsurTechs face newcomer challenges like high customer-acquisition costs and a lack of risk management experience.”