Digitalisation is changing the world at an exceedingly pace. What does that mean for our insurance industry? And who and what is driving this change? Together with Hugh Terry, Founder of The Digital Insurer, we presented our views, illustrated by the latest innovation emerging across asia, at the Swiss Re Advanced Risk Management Seminar on June 15 2017 at Fukuoka Japan.
To stay relevant in a fast evolving market, Insurers and Reinsurers have to understand the influence of Insurtech and the impact of digitalisation on life and health insurance, to identify both opportunities and challenges and to start delivering innovative solutions to (mobile first) customers. The expectation of our customers is a key driver of this change. We need to remember that we too are customers. Think about your reliance on technology in your every day life, from transport, to obtaining information, managing our time and sourcing almost any product or service.
93% of Insurance CEOs see the speed of technological change as a threat, compared to 69% in 2016.* The insurance industry as a whole is behind the curve. We surround ourselves with 'red tape' that makes implementation of technological innovative solutions difficult. To do it right we need agile solutions designed for the customer, enabled by technology, focus on risk insights supported by data. Most of all, we need to be brave enough to try and realise the value in taking a test and learn approach when considering innovative solutions. Learning fast (including potential failure), is vital to keeping up with the speed of change.
There are many tech-enabled solutions emerging across the world starting to impact Insurance, but it's not easy for insurers to cut through the noise of the Insurtech/Healthtech hype and identify the right tech and provider they can pilot with and scale.
So where do you start? Insurers across the world - and particularly across Asia - have already initiated their tech innovation journeys through 5 key strategies:
1. Build - develop the tech/innovation capabilities within different business units and setup an innovation governance and culture
2. Acquire - acquire the missing capabilities to build expertise
3. Partner - collaborate and partner with Insurtech providers (established tech giants or startups) to extend available capabilities
4. Incubate - establish an ecosystem of preferred tech startups to identify and nurture innovation internally and externally
5. Invest - take measured risks and invest in a portfolio of tech companies to acquire exclusivity or get prepared for the future
When it comes to looking at the future of health insurance, we have to look closely at the future of healthcare. While almost impossible to predict which specific solutions/tech will become mainstream, we do know that technology will have to lead the future of healthcare. 'The healthcare industry will be short of 12.9 million healthcare workers globally by 2035' ^ and tech-enabled solutions based on Artificial Intelligence, Connected Medicine, Blockchain, Genomics... to name a few, will be the key to empower individuals to better self-manage their conditions and help them pro-actively prevent risk to happen...
Now, how do you prepare for 2035? Thinking long term is a good strategic discipline It is clear that the convergence of health and tech is and will lead to further huge advances in healthcare. The future for (agile and tech-enabled) health insurers is bright. When it comes to our customer and technology, if we want to stay relevant, we have to act now, stay focused and start, one step at a time, our innovation journey. It is the responsibility of all of us, what can you do to prepare for the future?
The keynotes presentations will be made available in the next few days - in the meanwhile to read more about the emergence of Insurtech and Impact of digitalisation of life and health insurance, please follow the Swiss Re Institute and The Digital Insurer
Yannick Even, Swiss Re Head of Insurtech Solutions Asia
* Source – PWC 2017 Insurance CEO Survey
^ Source - World Economic Forum 2016
Location: Fukuoka, Fukuoka Prefecture, Japan