Every insurance company is defining the strategy and action plans to implement Digital Insurance. In most boardrooms there is an agreement on the necessity of Digital Insurance. However in many cases there is no clarity on the content of Digital Insurance, time frame of implementation, dependencies with other ongoing projects and strategic activities and the scope of the organizational transformation.

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DIGITAL INSURANCE STRATEGY
Every insurance company is currently defining the
strategy and action plans to implement Digital Insurance.
In most boardrooms there is an agreement on the
necessity of Digital Insurance. However in many cases
there is no clarity on the content of Digital Insurance,
timeframe of implementation, dependencies with other
ongoing projects, strategic activities and the scope of the
organizational transformation. The implementation of
Digital Insurance is not easy. It requires many changes in
the distribution and internal organization. The Digital Insurance transformation has to be prepared
carefully to prevent disappointments in Digital Insurance projects and initiatives. In the preparation of a
Digital Insurance strategy the following topics need to be addressed:
- Digital Insurance scope; Digital Insurance is not only about an online quotation or marketing
through social media, Digital Insurance is using all available technology to automate all
processes and services of the Insurance company and deliver maximum functionality to buy/sell
products and deliver services on mobile devices and internet portals. A digital strategy has to
define the full scope of digitizing the business.
- Target user groups; The users of the digital services are distributors, customers, service partners
and internal staff. Traditionally the scope is distributors, using online portals. Sometimes
customers are in scope and provided with a minimum of self service capabilities. Digital
Insurance is delivering all functionality to all clients and service partners to deliver 24x7 fast
service in product underwriting and claims management. Even internal staff in sales,
distribution, underwriting and claims management will be using the mobile service capabilities
when they are outside meeting customers and partners.
- Growth and efficiency expectations; the question is if Digital Insurance delivers more business
growth, is it just an efficiency improvement by using more integrated technology or is it
necessary to keep up with more advanced competitors. As the industry is a slow adapter of
digital there is no immediate threat from the traditional competition. Digital Insurance will
however bring more business growth as doing business will be easier for distributors and
customers, service will improve and using more integrated technology will deliver efficiency
gains.
- Multi-channel distribution challenges; Digital Insurance requires a multi-channel strategy
where products are delivered to insurance agents, brokers, banks and end-customers. Currently
these channels are more or less in use but most of the time provided with the same products. In
the digital world everything is more visible and Digital Insurance requires a sophisticated
product strategy to prevent channel conflicts and to deliver different products based on the
needs of the typical customers in these channels.
- Local or regional strategy and implementation; In a regional setting the question is always if the
digital strategy is a local strategy because of the local market practices and regulations or a
regional strategy. The preference is a regional strategy. Defining a regional digital strategy needs
leadership to convince and align all management teams on the digital principles. Digital

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Insurance is customer driven based on usability, simple processes, clear products and
comprehensive services which are basically the same for all countries with differences in
language, currency, product features and some extra regulatory process steps. The base
mobile/online application is 80% of the work and 20% are country specific features/changes. A
regional development and support strategy is preferable as it saves cost on the short and long
term.
- Product readiness; The digital strategy has to determine the products to be sold through mobile
and web applications and related services. The products will be sold using a multi-channel
strategy and need to be clearly differentiated from each other by identifying the customers’
needs in the specific channels. The simple products in for example direct sales channels need to
be pre-underwritten without any unnecessary underwriting steps to close the sale immediately
in as many cases as possible. Products that need underwriting approval, need support
functionality for underwriters to close the sale as fast as possible after approval. An assessment
of the readiness of all products is necessary to determine the digital product strategy.
- Organization readiness; Digital Insurance will change the organization. Marketing and
distribution will be fully digitized with more opportunities to reach potential customers. Service
has to be improved with Digital Insurance and will need more dedication to deliver excellent
support to customers 24x7. Operations will change where processing centers for policy issuing,
policy changes/endorsements and claims management will be downsized due to the automation
of all processes. The question is if the organization, culture, management and staff are ready for
this transformation. Do not start Digital Insurance projects before there is full alignment and
understanding of the consequences to prevent project failures.
- Distribution and marketing positioning; Digital Insurance will put the CMO in a leading position.
Selling products will be easier with no/less paper and tailored products for the customer.
Services will be digitized and supported by call centers and service personnel “on the road”.
Digital marketing will boost the business growth with more information of customers, social
media and internet marketing services made available by Google, Facebook, etc. and the
possibility to reach every customer through the mobile and online applications with tailor-made
products to increase renewal, cross- and upsell rates.
- Claims management; Digital Insurance enables better claims services. Fraud detection will be
easier with more information of the customers, distributors and other available external data.
Business rules will based on all available data to detect possible fraud and pay claims faster by
automating decisions, verification, approval and payment steps in the claims processes.
- Social media integration; Social media integration will enable the company to find leads and
determine up- and cross selling opportunities by selecting data from Social media feeds. All
important lead and social data will be stored into the customer/lead database for use by
distributors and marketing. Implementing social media integration means more understanding
of the potential and existing customers and will therefore definitely grow your business.
- Mobile and web solutions requirements; The question is if a web portal/application is required.
A mobile application could be sufficient as everyone has a mobile device. The sales of mobile
devices has overtaken the sales of laptops already. The functionality of mobile solutions and
web portals includes sales and lead management, customer relationship management,

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DIGITAL INSURANCE STRATEGY
quotations and illustration, self-service functionality for changes, endorsement and renewals,
claims management, approval management, underwriting and claims support and approvals,
document and case management. The sequence of delivery has to be defined based on the
needs of the distributors and customers.
- Required competences and available skills; Digital Insurance needs different kind of skills in the
organization from marketing to IT. Digital Insurance is not a technology implementation but a
business and organizational change to increase business growth, improve service and
profitability. The technology is available, the organization has to make a big change in
marketing, sales, traditional processes, products, underwriting practices and claims handling.
Without the required competences and culture change Digital Insurance projects will fail. The
strategy on organizational and culture change has to be defined before and aligned with the
technology change.
- Timeframe of delivery; The timeframe of the first delivery should be fast. A full digital
transformation will take a few years and therefore it is recommended to split the total
implementation into small deliverables which could be delivered in 3-6 months. Start with a
mobile application connected to a transactional database and build more functionality and
integration after successful implementation, acceptation and use by distributors.
- Current internal and external issues; last but not least is to consider if the current issues are
blocking a digital implementation or can be isolated from the digital strategy and managed
separately or solved by the digital strategy. However it is not advisable to create too many
dependencies in a digital project to prevent dependency issues later in the implementation.
The conceptualization and implementation of Digital Insurance requires a good understanding of the
scope, content and strategic targets defined by the digital experts of the organization. When the
scope is too small, content and usability is unsatisfactory and if targets are too ambitious digital
projects will definitely fail. Before you start make sure that there is a good understanding and
alignment on delivery expectations as well as the business case. If topics are not clear, do not start
and ask for more help from external experts to detail the Digital Strategy.
Digital Insurance Strategy
Paul de Bruijn
Singapore, October 1, 2015
Version 3
© Paul de Bruijn
www.pauldebruijn.com