Last week, I spoke at the InsurTechTO conference in Toronto. The theme of the conference was “Driving Advantage from InsurTech,” with an eye on being ready for the insurance industry’s evolution. My main contribution to the event was a presentation on the impact of digital on the customer experience.
Customer expectations are deeply impacted by the digital experience delivered outside the realm of insurance—an experience with a bar that is continuously being raised by industries like retail. But Novarica research shows that carriers have work to do. Only 61% of large life insurers offer same-day email response, for example. On the property/casualty side, only 51% of midsize carriers provide a paperless claims process.
In many ways, customer experience is the product, and players across the industry are working to stay competitive in that arena. Technology, starting with general adoption of the internet, has proven to be a key component of delivering a good customer experience. As younger generations begin seeking new products, carriers need to ensure that their services are fueled by tech. Capabilities like online support, straightforward point-of-sale processes, and automatic payments are increasingly becoming table stakes rather than differentiators.
One question looming over the conference (and over the industry in general) was, “Has InsureTech disrupted insurance as we know it?” InsurTechTO participants’ answers consistently reflected Novarica’s own research. While InsureTech has the potential to disrupt the industry, at this point it has mostly served to complement existing insurance offerings. There are great examples of truly disruptive changes to risk to capital allocation models, but in general members of the industry are struggling to define what “digital” means to them—beyond the confines of the portal space.
There was widespread agreement that carriers and new entrants alike are exploring the potential for real disruption. Incumbents and startups alike need to be prepared for a shifting industry. Standing still will not prove to be a successful strategy.
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