The definition of collaboration is the action of working with someone to produce or create something. That seems far too simplistic a way to describe the many types of collaboration already at work in the insurance industry and moreover does not begin to convey the looming and enormous demand for working together that will be required for success in implementing the Insurance Internet of Things (IoT).
Historically, the insurance industry has had to use a wide variety of collaboration tools to succeed as data, information, consumer behavior, products and regulations changed with increasing velocity. These tools included e-mail, texting, instant messaging, content management systems, enterprise social platforms and formal enterprise collaboration software. Insurers have even begun to leverage the use of digital technology and web-based collaboration tools such as Slack to empower employees, enhance user experiences, improve internal communication and strengthen agent and broker relationships.
See also: Insurance and the Internet of Things
Looking beyond insurance companies themselves, we note the emergence of insurtech accelerators and incubators, both independent and captive. What is becoming apparent is that there is a convergence taking place between these entrepreneurial startups and the traditional carriers, sparking collaboration between the new, small and fast market entrants with the old, big and slow incumbents. Much more of this kind of collaboration will be required for the insurance industry to survive and thrive in tomorrow’s world.
New forms of collaboration are emerging in the insurance ecosystem, some more formal than others. Strategic alliances and partnerships are being announced daily, as are vendor-vendor and carrier-carrier arrangements. Recent examples are plentiful; CoreLogic joined the Guidewire PartnerConnect program to deliver more accurate property risk pricing and residential estimating more efficiently to Guidewire’s property insurance customer base, and Insurity collaborated with Allstate Business Insurance to quickly deliver a new self-service quoting app with convenient data pre-fill.
Co-opetition is a more innovative form of collaboration that has been gaining traction. Former competitors work together to leverage a common, defined opportunity that yields better results for each company than either could have achieved on its own. In the world of insurance IoT, of which the connected car is a major subset, we increasingly see original equipment manufacturers (OEMs) participating in programs with auto insurers with telematics data exchanges and with each other in developing vehicle-to-vehicle (V2V) communication standards.
In other areas of insurance IoT, we are seeing a rapidly increasing number of health and property insurtech partnership announcements with insurers delivering innovative new risk-management products and services to consumers (e.g. Vitality-John Hancock, Roost-Liberty Mutual, True Motion-Progressive, etc.).
As the number of connected things expands exponentially, so, too, will the frequency and velocity of data generated by these sensors and devices. The ability to receive, normalize, manage and use all of this digital data will quickly exceed the capacity and expertise of even the largest insurers, so collaboration with a new generation of information management and data science providers will be mandatory.
See also: 12 Issues Inhibiting the Internet of Things
For insurers and others to successfully navigate this burgeoning ecosystem, access to relevant knowledge and competitive information will also be mandatory, and one effective way to gain these insights is participation in subject-specific industry conferences where expert speakers and industry thought leaders share their experiences and insights. One such event is the Insurance IoT USA Summit taking place in Chicago on Nov. 30 and Dec. 1.
So critical will be effective collaboration in the future that it is conceivable that formal courses, certifications and degrees in collaboration will be offered by business schools in response to the exploding demand for this set of business skills and expertise driven by IoT proliferation and adoption. In any event, participants in the insurance ecosystem that best master the art of collaboration are sure to be the market leaders of the IoT future.