Celent Insurance Newsletter, January 2014

28 January 2014

London, United Kingdom

From the Senior Vice President

Earlier this month, I attended one of our roundtable events on CIO priorities to discuss the topic of what "digital" means to the insurance industry. It was fascinating to hear from the delegates about the opportunities as they saw them, together with the challenges. It was also reassuring to hear many of the messages I heard at the end of last year at a CEO dinner being repeated.

Generally, the term digital means a variety of things to different firms depending upon the context. There is no common definition (in some cases, not even within the same firm). What is common, however, is the focus on creating a value proposition that people want (whether end customers, distribution partners, or employees). "What's in it for me?" is a key consideration for the digital recipe, and the ingredients nearly always consist of new forms of distribution enabled by mobility, data, and a compelling user experience.

There also appear to be two modes of addressing digital. For some firms, it is merely a continuation of their movement towards improving their online capabilities, using data differently, and achieving straight-through processing. For these firms, the focus appears to be more on enabling agility and faster execution of their existing digital initiatives.

For other firms, digital is a deeper, more transformational initiative, targeted at changing the culture, and potentially the business model, to respond to a threat or opportunity. These firms are either creating transformational digital initiatives or experimenting with new ideas using some type of “intrapreneurship.”

Regardless of approach, it would appear that distribution and customer experience are at the heart of digital activity. Ultimately, this has to be healthy for the industry (these areas have been neglected all too often). It's also interesting to spot the alignment between digital and the disruptive forces of innovation. In our report Innovation in Financial Service Firms: The Leadership Gap, the top four areas of potential benefit for successful innovation were all focused on distribution and customer experience (see chart below).

As 2014 progresses, we will keep coming back to the topic of digital and how it is being implemented across insurers. It's one of our primary research themes for this year.

Jamie Macgregor
Global Senior Vice President, Insurance

P.S. We will be honoring excellence in insurance at the Model Insurer Asia and Model Insurer Awards as part of our annual Model Insurer Asia Summit in Singapore on March 13 and Innovation & Insight Day in New York on April 3. We hope you can join us at these upcoming events!

Chart of the Month

From the Celent report Innovation in Financial Services Firms: The Leadership Gap

Celent Published Reports

Research in Progress

Consumers, Their Data, and Trust in the Organizations that Might Use It
EMEA Underwriting Systems 2014: Life and Annuity IT Vendor Spectrum
IT Spending in Insurance: A Global Perspective
Predictive Analytics IT Vendor Spectrum View
What the Internet of Things Means for Insurance

Calendar

30 January 2014
Roundtable
Making Innovation Happen
New York, NY

26 February 2014
Roundtable
Making Innovation Happen
Tokyo, Japan

27 February 2014
Conference
ACORD Forum Asia
Singapore

5 March 2014
Roundtable
Making Innovation Happen
London, UK

13 March 2014
Conference
Model Insurer Asia Summit 2014
Singapore

20 March 2014
Roundtable
Making Innovation Happen
Chicago, IL

3 April 2014
Conference
Innovation & Insight Day
New York, NY

For more information, contact insuranceevents@celent.com or call +1.617.262.3120.

Participate in our Research

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