In view of the fact that there is pressure to innovate in today’s fast-paced and changing insurance environment, insurers are responding by focusing their investments in technology on modernising core systems, a research report released by Strategy Meets Action (SMA), an insurance strategic advisory firm, noted.
The report, Innovation in Insurance: Expanding Focus and Growing Momentum, highlights the continued progress in and around innovation with expanding focus and accelerating momentum.
SMA argued that the focus on modernising core systems recognises “it is a foundational requirement for innovation and table stakes for entry into the leader positions in the market.”
The research further indicates insurer willingness to bring in “outside-in views by engaging open innovation and developing an ecosystem of outside resources,” notes the press release. This shift reflects “the demands of the digital revolution and outside-the-industry influencers that are increasing the focus on developing new products and engaging and strengthening customer relationships.”
Almost a third of insurers have their strategy or R&D leadership/areas lead innovation, the research shows. “SMA believes this reflects the resurgence of strategy and R&D efforts to provide an enterprise-wide approach for innovation that maximises the strategic impact and value of innovation initiatives for the organisation’s Next-Gen Insurer vision and strategy,” it added.
SMA reported that innovation drivers have been reprioritised as a result of the shifting landscape of the influencers of, threats to, and competitors in the insurance industry. It points out that of the innovation drivers, enabling growth (42%) and profitability (30%) have moved to the top.
The majority of insurers have focused on innovation for more than two years, and many for more than five years, “highlighting the growing momentum in the industry that will delineate market leaders and movers from the rest of the industry,” SMA founder Deb Smallwood commented.
“A new future is rapidly unfolding, and the pressure to innovate is on, as reflected by the significant number of insurers focusing on innovation,” SMA partner Denise Garth added. “Each and every day, insurers must recommit to their innovation journeys and their innovation cultures, to gathering outside-in views and to avoiding falling into operational traps,” Garth contended.
Source : Independent