Life insurers must have faith in change
Life insurers should be more optimistic about the ability of the industry to keep up with rapidly changing technology.
That is the consensus of the executive research panel, discussing life insurance in a time of rapid technological change, at the IIS conference which is taking place in London this week.
In a survey of the audience in a session yesterday (Monday June 23), optimism seemed low with 57 percent believing that the life insurance was not keeping pace with rapidly changing technology. This fell to 45 percent after the discussion, with 45 percent believing that the industry was on top of trends.
Gary Reader, global head of insurance and EMEA coordinating partner at KPMG, and chair of the panel, said: “The life insurance industry is not immune to the digital revolution. It’s transformed every aspect of many businesses. Digital advances, mobilisation, globalisation, cloud computing and the rise of social networks are all having are all having a disruptive impact on the volume and velocity of data that is now available.
“The transformational use of technology will have an increasing role in helping organisations collect and store, analyse and use this data.”
All members of the panel agreed that although companies may struggle to keep with technological advances, there are numerous opportunities to take advantage of.
John Warburton, director of group market management at Allianz SE, explained: “The debate has moved from should we respond to how do we respond, which I think is enormous progress.
“The opportunities are very real. The one benefit in the insurance industry, and the life industry in particular, is that the structure of products does create barriers to entry and creates inertia with customers, so we have not been beaten by this development yet and we still have time to respond.”
Russ Thornton, IT strategy and architecture director at Legal & General, added: “It’s not just a matter of catching up. What are you going to do to build a culture that embraces continuous development? The biggest issue is how do we organise ourselves differently.”
Brigitte Parent, senior vice president of individual insurance and investments at Sun Life Financial, added that it is important to think about how well consumers are being educated and informed and how the business can stay connected.
Mary Trussell, partner at KPMG, noted that insurers should ask themselves three questions: how diverse is your network, where do you look for signs of change and, this may account for some of the challenges, how brave are you in abandoning the past.
Tim Rozar, senior vice president of global research and development at RGA, added that there are two ways to think about technology, with the latter being the most successful option: you can look at what technology is available and how to deploy it or you can look at the problems the business has and how technology can be used to solve it.