The world is starting to emerge from the COVID-19 pandemic, and it feels a bit like the old story of Rip Van Winkle. First published in 1819, “Rip Van Winkle” tells the story of a man who sleeps for 20 years, only to emerge and, having missed the Revolutionary War, finds that so much has changed. However, he soon returns to his old ways, leading a life that is best characterized by an aversion to hard work.
Just like Rip Van Winkle, InsureTech connect revealed a world that is very much the same as it was before the pandemic, despite how much has changed in that time. With 6,000 attendees and over 600 vendors in person for two days in Las Vegas, InsureTech Connect revealed an insurance industry that — while impacted by the pandemic — is still dealing with many of the same issues and challenges.
Changes to Insurance Caused by the Pandemic
The swift arrival of the pandemic led to many immediate and profound changes to all aspects of both life and business. In the insurance industry, existing trends often accelerated while new levels of emphasis emerged. Three important developments included:
- Unlocking insights in data: The notion that “data is the new oil” has become something of a cliche, but the pandemic led to a new appreciation of the way data brings insight when traditional avenues are cut off. The emphasis is on new, enlightened approaches, and the success of fintech firms in attracting attention wasn’t lost on incumbents, who approached data efforts with new vigor. Data is seen as a key to differentiation.
- Cooperation and collaboration with non-traditional players: It has become clear that there is more than one path to innovation, and the past two years have led to a new and expanded vision of how cooperation and collaboration (particularly with fintechs and insuretechs) can kickstart innovation and growth. In some cases, incumbents are successfully building internally, but partnerships and acquisitions are more common.
- An emphasis on the claims experience: Removing the ability to interact face-to-face with clients spurred a greater focus on how technology can be utilized to enhance the claims experience. In turn, the use of technology as a replacement for direct interaction generated deeper insights as new tools and processes increased the cadence of analysis, thus leading to better understanding and fostering innovation. In the end, it’s a win-win for providers and customers alike.
Things That Are Remaining the Same
As much as things change, many more remain the same. This fact was well summed up by Evan Greenberg, Chairman and CEO of Chubb Ltd. In an appearance at InsureTech Connect, Greenberg emphasized that technologies are driving change, “but they are not changing the fundamental nature of risk-taking. Insurance is the art and science of taking risks. Fundamentally, that’s the business.” Greenberg went on to assert that change is less about implementing technology (“That’s the easy part.”) saying, instead, that “it’s about the culture and it’s about the skill sets.”
While experience suggests Greenberg is likely underplaying the complex challenges of implementing technology transformation, his points emphasized the importance of staying true to the roots of the industry and understanding the importance of aligning all elements (i.e., culture, technology, and skills) to produce favorable outcomes in both the short and long terms.
“Buzz Brands” From InsureTech Connect
Every major industry conference features companies and brands that seem to be everywhere and capture the zeitgeist of the moment. Examples this year include:
- HealthBridge: A new offering from industry pillar MassMutual, HealthBridge shows how customer-centric solutions can be created quickly in response to need and opportunity — in this case, in a matter of months instead of years.
- Plum Life: Not all innovations are targeted directly at the consumer. In the case of Plum Life, new tools benefit and enhance the advisor experience and, in the process, benefit the customer through faster interactions, increased options, and greater satisfaction.
- Bold Penguin: A former start-up in the commercial insurance space, Bold Penguin was literally everywhere at InsureTech Connect. They are also an indicator of the trend of startups being acquired by incumbents. In this case, Bold Penguin was purchased by AmFam (American Family Insurance).
- Arity: The typical perception is that insuretech innovation comes from start-ups alone, but firms have been able to generate fintech level innovation within the corporate entity. A perfect case in point is Arity, a mobility data and analytics company that was created by Allstate.
Rip Van Winkle in the 21st Century
Rip Van Winkle found his distaste for hard work didn’t change after a 20-year nap, and in the same way, the core values of risk management, customer service, and evolutionary innovation remained core to the insurance industry DNA. In other words, the insurance industry displays exactly the opposite of the Van Winkle attitude and worldview. In any case, awakening from the lull that was caused by the pandemic has been an eye-opening experience.
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* This post was co-authored by Sean McCarthy and Roko Sinovcic
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