Digitalization in the insurance industry
Insurance companies are in the midst of a comprehensive digital transformation. In particular, customer preferences have changed and competition has intensified. The insurance industry must understand and use the necessary digitalization as an opportunity. Therefore, AdEx Partners supports insurance companies in actively shaping these changes, using them as an opportunity for growth, managing them efficiently and implementing them successfully. On the business side and in IT, we accompany complex digital transformations of insurance companies end-to-end with our experienced experts.
Challenges for insurance companies
Insurance helps its customers protect important values: Health, property and quality of life. In this way, insurance helps and supports people to return to their daily lives in the event of damage or loss.
But who helps insurance companies with the current dangers as well as the disruptions of the business model and the sometimes rapid changes in customer needs as the following examples show:
- Self-driving vehicles will transform the business model around vehicle insurance.
- Virtual possessions, such as digital clothing as NTFs in Metaverse and personal or business data on cell phones and computers, are becoming more important than physical items such as real estate or household goods.
- Cyber security is playing an increasingly important role. IT crimes cause lasting damage to both companies and private individuals
- Climate change is rapidly altering the fundamentals of risk models on which insurance products are based.
- Everyday life is increasingly supported by sensor technology. Wearables and telematics, for example, are changing the data basis for customers and their behavior. This opens up new worlds in product development and risk assessment.
At AdEx Partners, we have solutions for this and other market challenges.
Our 5 Hot Topics for the Insurance Industry
Customer orientation
Contact with the customer is Key
With the customer at the center Rethinking products and processes
Observation / Problem
Too little customer feedback reaches the responsible insurance divisions – especially via the (sometimes overburdened) sales structures.
Online sales channels are set up in separate organizations and not integrated into the omnichannel approach.
The insurance divisions are strongly oriented toward competitors and market leaders.
The basic business model is still “money against claims”. Services that help customers in their life situation are only partially developed.
Little is still being done with existing customer data.
Approaches
Marketing & sales optimization
- Rethinking the customer strategy
- Derive realignment sales customer journey in goals, organization, processes
- Optimize sales processes in the dimensions contribution, efficiency, people
Customer Centricity
- Holistic transformation to Customer Centricity via the company’s value creation process to new products and services
- Establishing a resilient and continuous feedback loop to the customer and deriving adjustments in the interest of the customer
Time-to-market and costs
The Growth Hurdles Grow…
Finding the right IT strategy growth and profitability of the company
Observation / Problem
Many applications are outdated and inflexible. Quote: “Our IT is too expensive and too slow”.
Developers:inside can hardly be won over to old technologies.
Migration of core applications is expensive and lengthy due to the duration of insurance products.
In particular, overarching regulatory requirements put a strain on the too few employees.
The proportion of manual activities in the business units is high.
Approaches
Architecture & Technology
- Establish enterprise architecture management with strategic further development of the IT landscape
- Adjustment of IT strategy and operating model
ERP Transformation in the dimensions application landscape, processes & data, organization
- Increase business and digital alignment
- Derive appropriate scenarios and recommendations
Emloyee Centricity
- Finding and promoting the right employees internally and externally with talent management
- Becoming an attractive employer (employee experience)
Cyber-Security
Safety first!
Establishment and expansion of the company’s own capabilities for adequate information security
Observation / Problem
The expertise needed to build and expand cyber security is hard to come by on the market.
Opening of architectures in the direction of the cloud brings a new dimension of heterogeneity to the topic.
Since a lot of personal customer data is collected and processed, the criticality of the topic is high.
Approaches
Architecture & Technology
- Assessment, gap analysis and strategy development for cyber security and business continuity management
- Holistic management in the establishment of cyber security processes, methods, skills and organizations
Innovation
Change a winning team!
Actively shaping the future with Business Model Transformation
Observation / Problem
The current core business is often very profitable for insurers. The current interest rate increases additionally stabilize revenues.
Insuretechs are growing, but they only take up a small part of the market.
Insurers are often fundamentally risk-averse, which is reflected in cautious investments in new technology and ideas.
Innovation tends to be outsourced, via accelerators or creation of fast boats.
Company-wide digitization initiatives have not been successful.
Approaches
Business Model Transformation
Leading and guiding the holistic change of one’s own business model in order to meet changing customer needs and dynamic market changes in a sustainable way
- Analysis and assessment of the current business model and corporate strategy based on best practices
- Preparation of scenarios for the decision of targeted step-by-step changes including new business ideas
- Building a (digital) roadmap
- Steering the holistic transformation
Regulatory
Does it have to be…!
From efficient implementation of legal guidelines to constantly improving organization
Observation / Problem
The proportion of regulatory topics in the change portfolios remains high.
Often, these topics are additionally dumped into the organization “unplanned”.
Due to the rather Tayloristic organizations, there is a lack of identification of the individuals with the goals of these topics.
Approaches
Transformation Management
Setting up a fundamental change, with which all organizational units independently develop the maturity level of the processes and services for which they are responsible (-> making performance measurable and controlling it, targeted change on the basis of the strategy, continuous optimization) in the dimensions of
- People, culture and leadership
- Business and IT operating models
- Holistic and consistent strategy
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