When is an insurance company not just an insurance company? When it's also a tech company.
Last November, Oliver Bäte, the CEO of the German insurer Allianz, said that his company considers itself just that. “We are actually a technology company," Bäte said, because his company processes information and makes investment decisions based on what they learn; this means, in Bäte's words, "our core business is data processing."
If that sounds a bit inside-out, that’s because it is. The technological revolution is a radical rotation of assumptions and strategies that have reshaped the old, familiar model into new, unfamiliar dimensions.
One has only to look at insurtech to detect deep waves of disruption throughout the industry. "Autonomous vehicles, artificial intelligence, drones, the Internet of Things and blockchain, among others, are on the minds of insurance executives and increasingly incorporated into insurer strategies," said Mark Breading at Carrier Management.
So what is an insurtech company, exactly? According to Investopedia, it's a firm that uses tech innovation "to squeeze out savings and efficiency from the current insurance industry model." Venture Scanner, a technology-powered research firm, found in a recent analysis that the term includes insurers in one or more of the following categories:
Life, Home, P/C Insurers
"At the date of this writing in early February, the firm had counted 1,458 InsurTechs in 61 countries with total funding of $20.8 billion," Carrier Management reported. And the proliferation of companies such as these has raised the question: is the insurance capital of the world still Hartford, Conn.? Or is it more likely a place such as Silicon Valley, London, or Shanghai?
Whatever the answer, the result is clear. Insurance executives must adapt their thinking in order to maintain their edge: they have to consider the business realities of their industry, as always; however they must also adopt the forward-thinking attitudes that characterize tech leaders.
Such as? A willingness to fail fast.
If you're wondering what's so great about failure, you're not alone. No one likes to miss the mark. "But in the digital transformation, companies are flipping the switch," said Forbes contributor Daniel Newman. "Now more than ever, they’re realizing that failure is imperative to business success. It creates innovation by giving us the freedom to think beyond 'how things have always been done' — to disrupt and change our lives for the better."
By contrast, a recent study of 1,200 US-based executives showed that an "overabundance of caution" is by far the "biggest obstacle to innovating consistently." According to Big Think, one of the organizations that partnered to execute the study, "Companies are talking the talk of innovation, but they're not building the 'fail safe' structures that would enable them to walk the walk."
Fortunately, they provide some tips on how to fix that:
Separate yourself from your mistakes
Try new things
Experiment where failure is survivable
Is your organization fail-safe? Do you consider your organization a tech company as well as an insurance firm? How might these perspectives influence your future? We will keep you informed as trends develop.
The FedNat Insured Web is a great tool for our insureds!
They like having a centralized location to view policy info, make payments, upload policy documents, and elect to become paperless to receive a discount.
The insureds also can file a First Notice of Loss for a claim and access exiting claim info. Silvervine recently enhanced the site which allows insureds to upload policy documents directly to their policy. The uploaded docs go directly into our workflows and save a lot of manual effort on our part.
From my visits with agents, the agents appreciate the app for the amount of time saved on having to download and attach photos directly to the policy.
The app can also reduce the amount of staff required for a busy office to fulfill underwriting requests for photos.
When training agents they are amazed at how quickly the photos attach directly to the policy. After taking photos using the app and before they make it back to their desk, the photo is already attached to the policy. They also like the ability to attach additional photos for pre-existing damage.
Customer Service is seeing an improvement with retention as the text message definitely triggers phone calls from insureds to make payments.
The insureds love the fact that we notify them on their phones because they state that sometimes they don’t receive their mail for various reasons.
The insureds are paying more attention to the texts then to their actual mail. We try to set all of our customers up on that option if we notice that they are not currently enrolled, as it builds great customer relations as well as retention.
As a company we have adopted the use of Policy Scan for all our policies, and our agents have adopted the use of the app as well.
Not only is it easy to use, there is also no more worrying about losing photos, having to store photos or photos being attached to the wrong policy.
With Policy Scan we have increased efficiency in our workflow and reduced our exposure on the risk.
Silvervine’s core administration solutions easily handles multiple carriers within multiple states, including accounting, payment processing, immediate policy issuance and endorsements.
What started out writing one product, one line in one state has now grown into mulitple products, multiple lines and writing in multiple states. We have over $95 million in annualized premium in-force and we expect to grow by 20% during the next year all serviced by Silvervine.
Silvervine was our insurance software system of choice when we started the company in 2006. Silvervine enabled us to begin business within a few months of licensing the company. Today, we are one of the top 20 homeowner’s writers in Texas and SIlvervine’s solutions have been an integral part of our success.