Looking Forward: InsureTech Driving Seismic Industry Change
Well, they’ve done it. Majesco just traced the history of insurance from Hammurabi’s Code up to the present day in two paragraphs flat. We’re talking about the 2016 Majesco Report, of course. And the history they acknowledge isn’t insignificant. If there’s one thing that’s always been true of insurance, it’s the “universal and timeless need to stabilize individuals and the economy against risk, while meeting the changing needs and adapting to new developments or technologies that changed and shifted businesses, markets and risk.” At each moment, doing so “required business leaders to shed sacred notions and wake up to the possibilities of rebuilding on a new foundation while maintaining the old structure long enough to move out safely.”
You can see where they’re going with this. There are changes afoot in the industry – big ones. One might even call them seismic. And it’s going to take more than a few minor adjustments for insurers to adapt.
Who’s driving insurance industry change?
Majesco broke it into three categories.
- People: changes in demographics, needs and risk profiles, and customer expectations
- Technology: emerging tech and the explosion of data availability and analytics
- Market boundaries: new competitors, the blurring of insurance with other industries, and the shifting and expansion of channels
What does that change look like?
Over the last five decades or so, we’ve watched singly-defined industries turn into vibrant business ecosystems. We’ve seen previously-siloed products evolve into connected, multi-purpose offerings. We’ve seen zero-sum-game competition supplanted by strategic cooperation between competitors. We’ve seen buying turn to sharing, and users become co-creators.
Did we mention these changes were seismic?
The powerful market shift they’ve conspired to bring about is unprecedented; in fact, they’re rewriting the fundamentals of the business. At a time like this, long-held assumptions must be set on the table, reevaluated, in some cases dismantled and replaced. In the new, porous insurance market we navigate today, “engagement is everything,” and the relationships between the various players that be are “the new chemistry behind marketing glue.”
How should insurers respond?
The need for risk management is as old as Hammurabi. (Older.) What’s new is the need to tailor insurance products to the interconnected landscape of products and businesses that exists today. Majesco recommended:
- Let customers control which items to insure, when and for how long
- Let customers leverage buying power by forming their own risk groups
- Streamline the sales process by combining insurance products with those of other businesses
- Leverage emerging tech to help customers prevent losses in the first place
- Expand and integrate the channels in which coverage is offered
- Think creatively about new business models
Are you up for the challenge? Allow us to help you get to “yes.” Silvervine specializes in equipping insurers to compete in an ever-evolving landscape with nimble, adaptable insurance software. Download our “Losing Your Legacy” report or request a demo to learn more.