Many will pinpoint 2015 as a pivotal year - the turning point in the transformation of the business of insurance. External influencers and rapid technology advancements are resulting in major shifts in strategy, areas of focus and investment. Many insurers are thinking big - beyond the typical incremental change and toward bold moves that will establish them as leaders in the digital age.
Here are the top 10 trends that laid the foundation for this pivotal year and positioned the insurance industry for an amazing 2016 and the years beyond. The trends are dominated and enabled by technology developments, which continue to be interwoven into the fabric of insurance. The trends are:
- Digital transformation is taking hold, even in insurance.
- Innovation and innovative thinking have no boundaries.
- Huge $dollars$ being are being poured into start-ups.
- New ecosystems are emerging.
- Distribution channels are under strain, leading to shifts in investments.
- Core modernization is required and continues to consume insurers.
- Positive shifts are occurring in customer focus and priority.
- New tools, data and models are being embraced but are still a struggle to adopt.
- Many technologies are maturing and being adopted - cloud, analytics...
- Tech advancement is still outpacing the ability to consume.
Insurance executives can no longer ignore or play down these trends. Although the terms "disruption" and "transformation" are popping up everywhere, they are no longer buzz words but reality.
It would be a mistake to dismiss the magnitude of the shifts. As one senior industry executive put it, "Our industry will be substantially different five years from now. Companies that do not aggressively transform will be at risk of failing."
This view is shared by many industry leaders, who sense that the tide is shifting in the new digital era. Unfortunately, many others are hoping to ride out the rest of their career without driving change, an approach that is risky.