Keeping in mind the insurance business model is a few 100 years old, some of the key challenges we face include the periodic nature of the cover model and the entrenched, rigid communication lines. These issues can be attributed mainly to the industry’s attempts to control revenue, which don’t align with continuous value enhancement for clients and making insurance accessible to consumers and corporates. We need to always ensure that our core business purpose as insurers is the service to our clients and stakeholders. So, how do we build on the current service model?
Insurers currently have the benefit of Big Data to illuminate the shortfalls and future potential regarding the above. The next evolution of the insurance model, in preparation for the future, is the further development of artificial intelligence (AI) technology and linkages to non-insurance data sources. This would give us a personal or customised reflection of each of our clients in order to provide personalised insurance.
We, in insurance, must investigate the future use of self-service tools for both brokers and clients, which would enable us to respond to quotes with optimal efficiency, and provide “hyper-personalised” cover to our commercial and retail clients. The next step also includes the development of new products that consider behavioural factors and respond over various client life and business development stages, seeing that client insurance needs change as they evolve. Further to this, insurers of the future will offer much stronger service propositions that aren’t only insurance-related.
In the near future, new relationship models will enhance our channel and partner relationships to better recognise the value contributed by partners, and to enhance opportunities for long-term sustainability.
Insurance solutions must include the economic interest in the business or asset, and not simply respond to claims and perils. Instead of providing mere insurance solutions, the industry must move towards providing risk solutions alongside traditional insurance solutions. We should all aspire to keep small businesses in business, and this means alerting them to risk before an insurable incident takes place. And the same applies to personal lines, including car insurance.
To reiterate, our focus must be on offering our clients more than a response to claims.
We must use technology to leverage human capital and turn ideas into practice across the various insurance and non-insurance platforms. If we can achieve this, the transition from current operations to a future model should be a smooth one.