I’m doing a lot of insurance keynotes lately, in all sectors — property and casualty, life, employee benefit plans.
It’s catching some attention. The folks at ACORD, (Association for Cooperative Operations Research and Development), a global, nonprofit organization serving the insurance and related industries, reached out to me during the summer for a quick interview on some of the ‘big trends and challenges impacting’ the industry.
What’s moving the industry forward?
Published: 9/4/2013, ACORD
In searching the internet, looking for current events in the insurance industry, I recently came across an article from 2009 discussing the next big thing in the insurance industry by 2015. At the time, futurist Jim Carroll had plenty to say about the unavailability of niche skills due to increased underwriting complexity; the likely emergence of “social financial widgets”; and the implications of pervasive connectivity upon the insurance marketplace.
I reached out to him for an interview and asked him just how much his views on the future of the insurance industry have changed. Below is his response.
What are the most important things the insurance industry should consider as we move into the future?
The pace of innovation for the insurance industry – and indeed, every industry – is shifting to Silicon Valley. Think about the impact of GPS based driver performance tracking technology. The innovation with this type of tech occurs with computer and hi-tech companies who know how to innovate faster.
That fact will yield more significant business model disruption. If Silicon Valley has more control over insurance industry innovation, then it will have more control over the development and implementation of new and different, disruptive business models. Don’t think that ‘disintermediation,’ which was a big perceived threat during the dot.com years, has gone away!
Add to that the fact that the next generation of insurance customers are unlike any we’ve known before. My sons are 18 and 20, and will soon be responsible for big insurance decisions. They’ll be influenced by social networks and peers, online collaboration and research, online video. Generation Next is going to be a completely different type of customer, and they’re choice as to carriers, policies and distributions will be influenced in fast and new and interesting ways!
How will those changes impact the industry and the way the insurance industry conducts business?
It means that if you are a carrier, distributor, broker agent or anyone else, you need to learn to change – and change faster! Look, folks who work in the tech space innovate at tech speed. 65% of Apple’s revenue comes from products that didn’t exist 4 years ago. With such things as GPS auto tracking, there’s the opportunity for emergence of all kinds of new and wonderful insurance products. Some folks are going to get those to market quicker than others. And consider the wired, intelligent home – it’s happening now at blinding speed, and there are all kinds of opportunities to challenge ourselves as to the types of policies we underwrite, because the very nature of risk can change. I’ve got 3 webcams in my ski chalet that instantly notify me of any unusual activity – I should have a carrier that jumps out at me with some kind of innovative new policy.
What advice would you give to those who are having a tough time bracing for the future of the insurance industry?
Some people look at a trend, and see a threat. Real innovators – and long term winners – see the same trend, and see an opportunity!