Innovation in Insurance: Differences Across Continents

by Karen Monks,  Nicolas Michellod, October 31, 2014
Asia-Pacific, EMEA, Latin America, North America

Abstract

Innovation in technology has been rapid and consistent since the industrial age. In the last 20 years, it has permanently impacted the way that consumers and companies interact. Continual innovation in process and technology is required to compete in such an environment, regardless of the geographic location of the insurance company.

In the report Innovation in Insurance: Differences Across Continents, Celent analyses the differences among insurers in Asia-Pacific, Europe Middle East and Africa, Latin America, and North America in terms of their innovation initiatives, investments, and programs.

Implementing innovative and emerging technologies is important to attaining many strategic business objectives. Even though business priorities differ across continents, innovation initiatives can help insurers achieve their strategic goals directly and indirectly.

“Insurers recognize that the expectations of key stakeholders in the insurance value chain are changing. Customers, agents, and prospective policyholders all have greater expectations regarding the use of technology,” says Karen Monks, an analyst with Celent’s insurance practice and coauthor of the report.

“Our survey data indicates that insurers believe that innovation can benefit many aspects of their business. However, insurers recognize that they generally perform poorly in delivering successful innovation when compared with other companies,” adds Nicolas Michellod, a senior analyst with Celent’s Insurance practice and coauthor of the report.

This report details the results of our regional insurance CIO surveys as well as some specific innovation surveys conducted recently starting with a background on innovation in insurance and details on the results of our surveys. This report provides Celent’s findings on how innovation is perceived to support strategic business objectives and analyzes the priorities insurers consider important when investing in innovation initiatives as well as where they are in terms of these investments, and how their culture supports or hinders innovation.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

Survey Approach and Participants

2

 

Celent Research Themes

2

 

2014 Regional CIO Surveys

2

 

Survey Participants

3

Background to Innovation in Insurance

6

 

Background

6

The Business Case for Innovation in Insurance

7

Innovation Investments in Insurance

11

Execution of Innovation in Insurance

12

Innovation Culture in Insurance Companies

15

 

Executive Leadership

15

 

Ownership and Capabilities

16

 

Insurers Have Talents?

17

 

Barriers to Innovation

18

Final Thoughts

20

 

Focus on Business Innovation, Not Technology

20

 

Anticipate Barriers and Address Them Quickly

20

 

Look Outside Your Organization and Keep Curious

20

Leveraging Celent’s Expertise

21

 

Support for Financial Institutions

21

 

Support for Vendors

21

Related Celent Research

22

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