Insurance

While many insurers talk about “innovation,” few are taking a radical approach to innovation to drive business transformation. Insurance IT leaders must understand different types of business model innovations that are possible. Our firm can partner to identify the underlying technical requirements to support these models.

While most insurers report that they are innovating, most are doing incremental innovation without business model transformation.

Many insurers think most innovation is coming from the insurtech market, many incumbents are effectively innovating through a variety of approaches.

• Approaches range from bundled products/services, new value propositions (such as prevention) and a shift in business vision to better align with consumer preferences.
• Being innovative is not just about short-term wins like revenue growth. It is about building an organization that serves a greater good, drives more value than just insurance, and develops in a way that helps further its mission in helping customers, communities and consistencies in the future.

Insurance CIOs responsible for digital business strategy and innovation should understand and follow the three types of business model innovations:

• Product and distribution innovation: Work with business leaders to outline future product and distribution aspirations. This will require technical agility and openness that is not achieved in most current day IT operations.
• Customer value proposition innovation: Enhance customer intelligence through new data acquisition, including collecting more data customers can share, buying from third-party data brokers, harvesting interaction data and shared by partners.
• Organizational vision innovation: Draft a long-term innovation strategy with business leaders by reviewing the business models in this research, assessing the opportunities, and identifying the IT requirements for technical agility and composability that are needed for each individual model.