This enhanced level of service will require insurers to broaden their perspective of the broader business ecosystem in the industry – including who counts as an actor – and their role within it. They must first identify how they can strengthen the value chain given their existing organizational and technological capabilities. This new ecosystem should allow for a more personalized service offering that focuses on the client’s specific organizational needs – meaning that insurers may need to specialize to deliver value.
This is where clearly defined business models and broader ecosystem associations come into play. Combining an insurer’s understanding of risk with the data literacy skills of a technology-focused company, for example, could help insurance organizations identify the data insights needed to model the risks of insurance companies. intangible assets and find ways to mitigate them and calculate their costs. Similarly, it could be that the niche approach of equity providers or specialty insurers is combined with the reach of a global composite to deliver added value that none of those ecosystem players could manage alone.
To be successful in this changing landscape and to maximize their adaptability, insurers will have to develop a greater culture of partnership, collaborating with organizations outside their sector – or even with former competitors – to maximize the benefits that the entire value chain of Insurance can bring customers.
In addition to making technological improvements, the industry will have to undergo a cultural transformation. Insurers need to be more open-minded and willing to collaborate to remain relevant.
Right now, there is strong competition at every stage of the insurance value chain. But developing a flexible and adaptable ecosystem of strategic alliances designed to optimize the use of real-time data and meet changing customer needs could help improve performance and alter the fundamentals of the entire industry.
This is a huge change, but the rise of open banking shows that it is possible. This has freed up the flow of data in what was once a very restricted industry, fostering innovation and improving customer service as banks focus on areas where they can bring real value to their customers.
The new partnership-based insurance ecosystem will also offer more defined positions for insurers and reinsurers built on a stronger value proposition. This will help drive customer loyalty – and ultimately improve profitability – for both insurers and reinsurers.
By reimagining how to deliver true value to customers, insurers have the opportunity to take advantage of the growing wave of innovation that is already beginning to reshape the industry. As they redefine their value propositions and role within the broader insurance ecosystem, a new value exchange should emerge that better serves everyone from policyholders to reinsurers.