The first thing to note is that innovation submissions were up by over 27%. This is a testament to the adaptability of the industry and the willingness to meet new customer expectations. The acceleration is so important that we believe it is more than just adapting to fast-changing customer needs. Insurers are entering a new era of transformation – transformation of distribution, transformation of servicing, and transformation of the insurance operating model. All of this is empowered and accelerated by technology, mostly AI and cloud technologies.
As we compare 2020 and 2021 submissions, six major trends emerged.
The first is Experience, redefined, which refers to providing the anywhere, everywhere experience required by new customer expectations. Essentially, insurers are examining how to provide reimagined experiences that are comparable to what other industries (such as retail) are already providing. Almost every insurance company that submitted to the awards has reimagined their experience in some way, but here is an interesting example: MACARENA is redefining experiences through an innovative AI voicebot. The voicebot provides an 100% automated First Notice of Loss in home insurance claims. The solution combines the latest technologies - NLP, ML, predictive models - but also deep knowledge of the processes, the service, and the expertise in the business.
Linked to this is the next trend, Pervasive AI. AI defines experience and experience defines AI. This trend is massive, as we have seen it applied at scale across all dimensions of the value chain. AXA’s A.Iconic claims, for example, leverages a cloud-based ecosystem of common smart data and A.I. services across AXA International Entities around the world for motor claims processing with initial implementation in Morocco and Turkey.
It’s been seen in previous years and continues to be a core tenet of insurance transformation – Embedded Ecosystems. It’s all about blending insurance into other value propositions and distribution models. While this trend isn’t new, it has certainly intensified in the past year. Take the case of Baloise, which is continuously strengthening its ecosystem of home services for homeowners, tenants and landlords Both internally developed like MOVU and offered via partnerships (Devis.ch, Batmaid) or through the acquisition of start-ups like Houzy to create a ‘All-in-one’ platform.
The attractiveness and value of Phygital Health and Wellness solutions has intensified with the Covid-19 pandemic, but it has now gone way beyond that. Health and wellness value propositions are being accelerated by this new, digitally-enabled world, allowing insurers to expand their suite of services to clients. Generali Wailon’s Staiwel is an interactive, simple, and intuitive integrated platform dedicated to the well-being of employees and their families, which presents promotions, goods, and services on exclusive terms. Staiwel offers a wide selection of services and a simple user journey.
The Working Unleashed trend refers to the workforce collaboration forced by the Covid-19 situation. Take the case of AKSigorta, which has set up cross-functional platform structures within the organization to gain a competitive advantage, create new markets, and build new capabilities. Eliminating organizational silos, the platforms help AK Sigorta transform from a channel-based way of working to an agile and output-focused way of working.
Last, but not least, a standout trend – Insurance Goes Green. This is such a rising trend this year that it may be included as a category for next year’s Efma-Accenture Innovation in Insurance Awards. Insurance is really starting to incorporate sustainability practices into its value propositions and this will be an important trend to watch in years to come.
Sustainability is a societal issue, a customer request, and a new mission for insurers to be sensitive to what they can do to improve the climate situation. It’s no wonder that it was this year’s fastest growing trend highlighting some of the directions insurers are taking in their sustainability agenda. A first approach is to embed sustainability into their product offering and incentivize clients to adopt sustainable behaviors. Baloise and BNPP Cardif have both taken that approach.
• Baloise’s Drive Electric initiative is the first motor policy that provides services to help clients switching to electric vehicles. It offers a card and an app that allows users to recharge at 180,000 stations in Europe. Clients can order, via a digital platform, an all-in package including a recharging station, its installation, and the required advice services.
• BNP Cardif is taking a completely different approach with the introduction of Smarty+. In order to contribute to the extension of smartphones' lifecycle, Smarty+ extends mobile insurance to cover second-hand devices. The prerequisite was to be able to check the device’s condition prior to the subscription, to see if all parts work (screen, plug).
A second approach is to make a thorough analysis of the insurer’s internal processes and value chain looking holistically at where energy consumption and waste can be reduced. Generali Germany’s AI Meets Sustainability is one of this year’s submissions showing the way for insurers. The usage of AI enables sustainability and cost reduction in Generali buildings. The AI software works on top of the current building management system. It dynamically manages the heating, ventilation, and air conditioning autonomously based on the local weather forecast and generates substantial savings.
A third and very promising approach, although beyond the scope of the Efma Accenture insurance innovation awards, is to leverage the enormous asset portfolio insurers are managing to progressively refocus it on more sustainably friendly investments. Several large global insurers, the likes of AXA, Allianz, and Generali, but also a host of other insurers, have already made public commitments to reduce their investments in coal-based energy supply and to rebalance their assets towards greener funds. Additionally, other insurers are looking at how to apply an energy savings approach to their large real estate portfolios as well as commit to low or zero carbon emissions for their new real estate investments.
To conclude, innovation is no longer a trend, but a necessary strategy driver for every insurer that hopes to survive in the future market. As the trends above show, this transformation will reshape insurance businesses – and their interactions with customers and related markets – for the better and hopefully a greener future for the planet.