The document discusses trends in the insurance industry towards digital transformation. It outlines how insurance is evolving from Insurance 1.0 which was analog, to Insurance 2.0 which was IT-enabled, to Insurance 3.0 which is digital. Key trends driving change include demanding customers, evolving technologies like AI and IoT, and disrupting startups. New business models are emerging like peer-to-peer, on-demand, usage-based, and social broker insurance. Technologies are disaggregating the traditional insurance value chain. Insurers need to focus on digital customer experience, omni-channel experience, optimized operations, and leveraging big data and analytics to adapt to these changes.

1. INSURANCE
TRENDS
WORKSHOP
FEB 2 2017

2. THE BEGINNINGS
INSURACE 2.0
ANALOG
INSURACE 3.0
IT ENABLED

3. INSURANCE 4.0
DIGITAL
ERA

4. THE DEMANDING ECOSYSTEM
DEMANDING
CUSTOMERS
Today’s customer
want richer
experience at a
cheaper price.
They are not just
looking for
products / services
but a partner who
can help them
achieve their goals.
EVOLVING
TECHNOLOGIES
Technology is
evolving at an
unprecedented
pace. We live in a
world of
connected
everything.
Enterprises need
to constantly
innovate to stay in
the game.
DISRUPTING
STARTUPS
Startups with a
simple idea and
some spare change
are able to disrupt,
even bankrupt
existing
organizations
UNREASONABLE
REGULATORS
Regulators across
the globe are
becoming
stringent and are
imposing
“unreasonable”
demands and
heavy fines on
non-compliance.

5. DEMANDING
CUSTOMERS

6. DIGITAL FIRST
HEALTH &
WELLNESS
CONNECTED
LIVE LIFE

7. INSURANCE IS A COMMODITY

8. COMMODITY
PRODUCTS
SERVICE
EXPERIENCE
DIFFERENTIATED
UNDIFFERENTIATED
RELEVANT
IRRELEVANT
MARKET PREMIUM
CUSTOMIZATION
CUSTOMIZATION
COMMODITIZATION
COMMODITIZATION
COMMODITY VS EXPERIENCE
COMPETITIVE
POSITION
CUSTOMER
NEEDS
PRICING

9. DWINDLING LOYALTY
82%
of consumers in
Japan switched to
a new auto
insurance carrier
in the last 12
months
40
NPS point
difference between
the leader and the
laggard in Japan
(leader is Sony)
22
NPS point difference
between the insurers
who had interaction
with customers and
who didn’t
80%
of Japanese
expect insurers
provide services
beyond insurance
coverage
Bain’s new survey of 164,421 consumers in 19 countries 2016

10. EVOLVING
TECHNOLOGIES

11. Bringing together
what humans do
best with what
machines do best
• Claims investigation
• Property Assessment
• Personalized customer interactions
• Fraud detection
• Automation of back-end operations
ARTIFICIAL
INTELLIGENCE

12. The power of network of
physical objects with
embedded sensors to
gather information
• New models of insurance
• Improve customer engagement
through increased number of
touchpoints
• Be ready to respond before the
customer notifies
INTERNET OF THINGS

13. Explosion of data and advanced
analytical capabilities have enabled
insurers to personalize products and
better manage risks
•Advanced customer profiling and
personalization
•Enhanced fraud detection
•Preventive actions and
recommendations to customers
•Enhanced customer experience by
integrating structured and
unstructured data
BIG DATA
& ANALYTICS

14. DISRUPTING
STARTUPS

15. THE POWER
OF AN IDEA
OLD DISRUPTION
Few people had access
to capital and tools,
hence generating few
disruptive ideas
Many people have access to digital tools
and the cost of experimentation is
significantly low.. Hence bring more
ideas to the market
POWER OF AN IDEA
=
100 x OLD DISRUPTION
DIGITAL DISRUPTION

16. NEW AGE
CUSTOMER
ADVANCED
TECHNOLOGIES
NEW BUSINESS
MODELS+ =

17. Peer-to-Peer On-Demand UmbrellaUsage Based
NEW BUSINESS
MODELS
Social Broker

18. Peer-to-Peer
In Peer-to-Peer, the
provider is the
insurance company
and if the pool of
peers is “profitable",
the "excess" is given
back to the pool.
• Premiums are paid to the
insurer
• The insurer has full control of
the claim review process
• The money left after paying
claims, plus the interest on
premiums, is kept by the
insurer
• Premiums are placed in your
community's pool
• We handle claims for your
community, but we don’t keep the
money if your claim is denied
• The money left after paying claims
plus the interest earned is paid back
to the community

20. AGGREGRATORS
On-Demand
Providing insurance,
instantly, for a set period
of time and often for an
individual item.
Trōv & Sure utilise a
purely digital experiences
via apps with no human
contact.
Trōv also uses a chatbot
within the app to submit
a claim.

22. Usage Based
Designed to provide
customers with with
a policy that reflects
the risk more
accurately.
Metromile pay-per-
mile insurance uses
a ‘black-box' that
plugs into the
vehicle, that reports
to an app, which
shares data with the
company.

24. Umbrella
In an age where loyalty to
insurance companies doesn’t
exist, umbrella insurers are like
digital agents, that collate policies
from multiple insurers and utilise
data to help the customer make
decisions.
Confidant uses customer data
from various policies to search for
other providers, as well as
providing a central place from
where they can claim, all while
being connected to a neutral
advisor

25. Social Broker
The Social Broker model brings
together groups of people who want
to take out the same insurance
policy, and by doing it as a group,
often leads to large savings.
Bought By Many members form
groups and BBM negotiate for prices
from insurers. BBM claims it saves
unto 18% on policy charges for the
members

26. Sales &
Distribution
Risk &
Underwriting
Claim
Management
Policy
Management
INSURANCE
VALUE CHAIN
The entire value
chain is typically
controlled by one big
entity such as Sompo

27. Sales &
Distribution
Risk &
Underwriting
Claim
Management
Policy
Management
DISAGGREGATED
VALUE CHAIN
The disruptors are
disaggregating the
insurance value chain

28. https://www.ftpartners.com/insurance-technology-report

29. Sales &
Distribution
Breaking away from
offline agents network to
online direct to consumer
Price comparison sites
are becoming popular for
insurance shopping
Digital agencies that
partner with selected
insurers are being used
widely because of their
personalized and
delightful experience
Price
Comparison
Digital
Agency

32. Sales &
Distribution

33. Risk &
Underwriting
Innovators are
building specific
solutions to improve
risk profiling, and
help with
underwriting

34. Policy
Management
Disruptors such as
CoverWallet are
putting the
customer in control
by providing them a
easy way to search,
buy and manage
policies in a single
place

35. Policy
Management
FinanceFox enables
customers to
manage their
policies using a
smartphone

36. Claims
Management
INSURER CUSTOMER
Claim processing
& payment is a
cost to the
company
Claim is the only
reason I buy
insurance

38. Claims
Management
FNOL INVESTIGATION PAYMENTS

39. Claims
Management
NOTIFICATION FNOL INVESTIGATION PAYMENTS

40. NOTIFICATION
Auto
• Automatic collision detection
• Stolen car recovery
• Driving behavior pattern detection
• Roadside Assistance
Home
• Smoke detection and fire prevention
• Flood & leak detection
Health
• Fitness Tracking
• Health monitoring
NEST SMARTHOMES (www.nest.com)
NEOS CONNECTED HOME (neos.co.uk)
BMW EMERGENCY CALL
SMILING ROAD
ZUBIE (http://zubie.com/)
VITALITY INSURANCE (vitality.co.uk)
SJNK HIMAWARI LIFE INSURANCE -
FITBIT FOR EMPLOYEES

41. • Automatic emergency response
• Simplified claim registration
• Video & Image capture
• Straight through processing
ClaimDi (www.claimdi.com/en/)
FNOL

44. • Aerial Imagery & property
inspection
• Fields agent app for property
inspection, task management &
reporting
• Fraud detection through analytics
• Manage disputed claims by
aggregating data from various
sources and building predictive
models
INVESTIGATION
KESPRY DRONES
(http://kespry.com/industries/insurance)
SPEX (https://spexreport.com/)

46. The Shift Technology Solution
leverages the best of AI to make
insurers save money.

47. AGENT BANK
INSURANCE
COMPANY
REINSURER
AGENT BANK
INSURANCE
COMPANY
REINSURER
DIRECT DISTRIBUTOR
DATA
OWNER
CAPTIAL PROVIDER
ANALYTICS
ENGINE
www.iii.org

48. WHAT DOES IT ALL MEAN TO YOU?
DIGITAL CUSTOMER
EXPERIENCE
• Digitize selected
“moments of truth”
such as claims status
• Self-service
capabilities
• Integrated analytics
to measure and act
OMNI-CHANNEL
EXPERIENCE
• Seamless
experience across
sales & service
channels
• Social media
connect
• Single source of
truth
OPTIMIZED
OPERATIONS
• Single view of
customer
• Digital claim apps
• Field apps for
investigators &
adjustors
• Use of AI and IoT
BIG DATA &
ANALYTICS
• Data integration
from devices and
sensors
• Social media & other
external data
integrations
• Best-in-class
analytics capabilities