"Remember a dead fish can float down a stream but it takes a live one to swim upstream." W C Fields
Which dead fish? Matt Connolly, CEO Tallt Ventures says:
"For years I’ve been presenting to, and working with, the boards of insurance companies around the world. We talk about the changing business landscape, the role new technology and customer propositions play, and how incumbents are struggling to innovate. All too often, it’s not the innovation that’s the missing ingredient; it’s the lack of ambition. Without the latter, you’ll never have the former."
Matt gives an example of outstanding ambition in the article link at the end of this piece and a pointer is the photo in my blog. He knows how incumbent insurers should act: -
"On one side are the startups struggling to scale and in desperate need of distribution. The other, corporates failing to innovate whilst sitting on a pile of cash and customer data. Bring the two together and you open up a world of opportunity."
Tallt Ventures has the largest global database of Insurtechs and you can access this from his link. It is important to find the right innovation partners especially with the competitive threats from so many sides.
Matt tells incumbent insurers to not ignore Lemonade which is going global at the end of 2018. Lemonade is live and swimming upstream.
There are shoals of innovative and voracious insurance live fish swimming in Asia Pacific and that is more important than you might think. By 2040, 60% of the top earning quartile of consumers will live outside the Western World.
Source Hans Rosling in Factfulness 2018.
They are being funded by the APAC competitors to the Western GAFAs. SoftBank, ZhingAn, Tencent- themselves massive distributors of insurance products. Will US, Canadian and European Insurers capture this new APAC market?
In making the right decisions the C-Suite Digital Transformation Officers do have a major dilemma and that is which strategy?
- Short-term as CEOs start to demand fast action on customer engagement and delight?
- Medium-term to develop the portfolio of new products for a changing world of P&C and Commercial Customers?
- Long-term to be leaders in the developing ecosystems that will dominate trade globally?
They have no choice- all three are vital.
So the insurtechs they chose must enable incumbents to action all three timescales. Agile is not good enough- tahe this tip from Maarten Ectors Chief Digital Officer at Legal & General.
"Find the “Why?” every employee needs to get up in the morning. Reorganise around products. Introduce one important innovation key success indicator: 3M’s NPVI, i.e. new product vitality index, would be a great start. NPVI measures how much percentage of revenues come from products that did not exist 5 years ago. 3M makes more than 10,000 products and they have their NPVI at an amazing one third. Want to predict the future? Create a Wardley Map (https://leadingedgeforum.com/advisory-service/wardley-maps/)."
Incumbents are still lookingvat six month POCs. They are playing with a few insurtechs and over-confident just because they have an insurtech skunkworks and investments in new start-ups. It's almost too late unless you have already deployed digital platforms that combine: -
- Digitally transformed buying, selling and servicing of products and claims
- Communicating and Orchestrating customers, internal staff, and external supply chain partners & contractors to delight customers and be profitable
- Delivering real-time analytics for optimal decision-making and execution.
Hers is one already doing so for a number of global insurers swimming strongly up the rapids and outpacing slower rivals. 360Globalnet.
Of course, as Matt Connolly says you must spread your net wide but be assured here is a great benchmark to ensure you are a global leader in the 2020's and not a dead fish just floating downstream.
For years I’ve been presenting to, and working with, the boards of insurance companies around the world. We talk about the changing business landscape, the role new technology and customer propositions play, and how incumbents are struggling to innovate. All too often, it’s not the innovation that’s the missing ingredient; it’s the lack of ambition. Without the latter, you’ll never have the former.