External partnerships hold the key to innovation

Insurers should seek to drive innovation by partnering with companies that are external to the industry, Gary Reader, partner, global insurance sector leader and Phil Smart, head of insurance and investment management, KPMG, told Monte Carlo Today.

They explained that their firm’s recent pairing with McLaren had already boosted their own offerings.

Smart explained that part of KPMG’s search for innovation included teaming up with McLaren in order to access the company’s data.

“We looked at a number of different options, but McLaren has vast data management capabilities, and with similar interests, it was an ideal partner for us,” he said.

Reader added: “We’ve already been able to use some of McLaren’s ideas and technologies within our own products and services.”

He also explained that driving innovation was the theme of the forthcoming KPMG report—A New World of Opportunity: Insurance Innovation Imperative.

The report surveyed 300 CEOS, and among those, 83 percent said that innovation was needed.

Using the example of Uber and Airbnb, Reader said that perhaps the new entrants will operate in a similar way, as underwriters that don’t own their own capital.

Smart agreed. He said: “Perhaps it will be these new entrants that shake things up. Google will almost certainly play a role in insurance at some point.”