Digital transformation vital to the survival of insurance firms

Capgemini’s World Insurance Report 2018, conducted in partnership with Efma, has highlighted the need for traditional insurance companies to digitally transform their operations as customers are showing an increasing willingness to purchase insurance products from technology firms.

The report reveals that 40% of customers would consider a mobile insurance app as an important channel, whilst 38% of those aged 18-34 stated that they would be willing to receive personalised insurance offerings through a number of channels.

See also:

• Sabre partners with Microsoft to accelerate digital transformation

• KPMG, Google partner to create transformative digital solutions

• Empowering digital transformation from the inside out

With this in mind, the likes of Amazon, Apple and Google are in a strong position to enter the market, whilst long standing industry operators are set to lag behind if they do not invest in and implement new technologies.

“The use of data and being able to offer a truly digital customer experience are both critical for the insurer of the future, something Big Tech firms like Amazon and Google excel at,” said Anirban Bose, Global Head of Financial Services and Member of the Group Executive Board at Capgemini.

“The threat from such entrants is more real than the insurance industry might want to admit. Insurers, risk assessors by nature, must urgently turn their gaze inwards and consider the competitive risks within their own industry in order to evolve and survive.”

One method that insurance providers may pursue in the aim of satisfying the growing expectations from customers is through partnering with industry-specialist technology companies such as insurtechs.

“To gain value from their investments, insurers must think about the big picture and develop a holistic approach that is strengthened by insurtech capabilities, rather than piecemeal adoption,” said Vincent Bastid, CEO of Efma.

For more information, see the full World Insurance Report 2018 from Capgemini and Efma.