InsurTech for&from Millennials
InsurTech startups are coming to a party
PwC Insurtech Innovation Report (2019) says that insurers perceive insurtech modernization as the risk number one. They are concerned about the speed of technological change and, at the same time, they are afraid that insurtech innovations are highly prone to a failure.
PwC and Deloitte both recommend them to invite (choose wisely though!) insurtech startups to collaborate with internal tech innovations teams and build a robust insurtech strategy.
A coming digital transformation of the insurance field is nothing to doubt. Especially as we entered the covid era, an urge to go digital is ubiquitous. It became a form of self-preservation for insurers, employees and customers as well.
Post-Millennials will define the market from two perspectives. And they adopt a different approach
In the next decade, customers profiles will change dramatically. Half of an adult population will be represented by (Post-)Millennials (aka generation Y) whose customer expectations and behaviour differ from currently dominating generation X and baby boomers.
The customer and employee mix will shift dramatically. Millennials and post-millennials (those born after 1997) will make up nearly half of the adult population. These digital natives will expect seamless, omnichannel, real-time interactions integrated with the platforms they already use frequently—along with some we can’t imagine today. Claims 2030: Dream or reality?
The landscape of customer preferences is evolving towards seamless, omnichannel access. People are highly social and highly digital (World Insurtech Report 2020).
On top of that, traditional insurance players should realize one more thing. (Post-)Millennials will not shape the market from the customer perspective only. They will drive the innovations as the insurtech builders also. As PwC and Accenture pointed out, especially those 300-year-old insurance companies should start to think about how to combine their company culture with 300-day-old startups that inevitably are becoming their partners.
A clever mix of the best from artificial and human intelligence
McKinsey made several predictions towards 2030 about the future of claims as well. Now, ten years earlier, some of the fundamental changes are already here, and some are being adopted right now. The tech innovations are playing the leading role in the transformative process, but still, we won’t get along without human intelligence and insight.
It is not solely about employing new technology, automation and fast decision making. As McKinsey stressed out in an article Claims 2030: Dream or reality?, people will not just step back to make way for automation and insurtech. They need to create an effective partnership with technology. Even Millennials need to talk to people sometimes, and some issues will always be too complex to be dealt without human touch.
Leading claims organizations will evolve to combine and harness the best features of artificial and human intelligence -- and eliminate the blind spots in both. We expect humans to continue to be essential to the claims process. And thanks to their use of digital enablers and AI, they’ll be able to work more productively and effectively. Claims 2030: Dream or reality?
To make it short: Digitalize or die
McKinsey study says that a digital transformation of claims-related processes improves the main three key performance indicators. It can bring up to 30 % reduction of claims expenses, increase customer satisfaction by 20% and help enhance claims pay-outs accuracy (McKinsey, 2018). These numbers cannot leave any insurer cold. Especially, as they will go higher in the next years due to the demographic changes and dominance of the millennial culture.
As KPMG put it in their Insurtech 10: Trends for 2019: Digitalize or die!
InstaClaim is an insurtech startup that was growing up next door to traditional insurance companies (Hello, Direct and Generali Česká pojišťovna!). It evolved from a perfect mix of seasoned gen X founders and millennial digital natives. It makes InstaClaim an excellent candidate for those insurance companies that want to keep up with the innovation curve and are looking for a close partnership with an agile insurtech startup.