It is amazing how many senior industry professionals I talk to who are both intrigued by, and fearful of, the InsurTech eco-system. At one end you have the intrigue around the sector - what fantastic ideas are out there that could help me transform my business or gain a competitive edge? At the other end you have the fear - what if Amazon, Google, Facebook, Apple (delete as appropriate) come and disrupt our business model? Yet few know how to engage with this new world effectively.
History tells us that collaboration between an Insurer and InsurTechs works best when the tone is set from the top - when innovation, led by technology (for that is all InsurTech really is) is driven by the leadership and seen as important to the success of the business as selling policies, or processing claims. Far too often it isn't.
The responsibility for InsurTech innovation is often handed to one person, yet the ecosystem is vast and ranges from well-funded and run companies providing mature offerings, through to companies with little more than an idea and enthusiasm. It is far more than one person can span. Evidence suggests that engagement needs to be undertaken by a number of empowered people across the organisation, who coordinate and help drive a culture of innovation from within.
Those people need to work together to build relationships with mature companies, but also ensure they are “plugged in” to start-up incubators alike. Be mindful, with a wealth of InsurTech events and conferences available, pick the ones that provide real value.
Managing a pipeline of potential collaborators is another challenge that is often badly handled. There are many fantastic InsurTechs out there, selecting the ones to progress conversations with is an art learnt over time. So balancing enthusiasm and curiosity, with a healthy dose of questioning/cynicism is no bad thing. Ultimately you are looking to build a pipeline of engagement that spans the highly opportunistic, through to the mature.
Of course, initial assessment and pipeline building is only the first step. Knowing how to start piloting/delivering comes next. Many organisations fail by trying to apply the same governance and ways of thinking as they would traditional delivery. A more relaxed set of boundaries for piloting InsurTech initiatives is vital, as is having clear criteria for shutting a pilot down if it isn’t working, or industrialising it if it is.
Perhaps the elephant in the room though is fear of failure. In short, my four tips for those looking to engage effectively with the InsurTech industry are:
- Set the tone from the top – Make it unambiguously clear that leadership believe their business success is dependent on innovation, led by technology, and set measurable targets
- Create the capacity – Identify people across the business, that are going to lead the InsurTech charge and ensure they have the time, money and empowerment they need
- Understand the landscape – Spend time meeting people and organisations to understand where best to focus your time. Be curious and open minded, but be disciplined
- Delivery is important – Great conversations are interesting, but they won’t improve your business. Establish an environment that allows you to start, shut down or industrialise new InsurTech ideas.
Get this right and the opportunities to develop the business in new and exciting ways are endless.