The 20th annual CEO survey from PwC has highlighted the continued threat of technology to the status quo in insurance, with 42% of CEOs stating they are ‘extremely concerned’ about it as a potential threat to growth prospects.
InsurTech as a threat It seems that technology continues to be viewed as a threat, rather than something to be embraced. Interestingly, a further 41% of respondents are also ‘somewhat concerned’ at the pace of technological change, but while 83% have concerns, less than half plan to collaborate with entrepreneurs or start-ups in the next twelve months to do something about this.
PwC comment in another part of the report that 86% of insurance CEOs expect the industry to be significantly impacted within the next five years thanks to advances in technology. They also note that collaboration, not confrontation, can help these businesses innovate at breakthrough pace, instead of incremental steps.
InsurTech as a partner As technology transforms insurance, three key areas need to be addressed to take advantage of the changing business landscape: Data, Digitizationand Trust. Insurers already know the vital importance of data and analytics, for everything from postcode-specific car theft statistics to actuarial life insurance predictions, but they’re wary of the latter two elements.
CEOs are concerned about digitization, especially with the growing cyber attack threat. Having extremely sensitive information on file for policyholders, insurers and brokers alike are at risk of significant loss of trust in the event of a breach of their systems. As CEOs acknowledge this, with 72% of them asserting that it is harder to be trusted in the digital world, they also seek to differentiate their businesses in how they manage the data they hold, with 78% of respondents confirming they agree, or strongly agree, that differentiation is a strategy they want to pursue.
It’s clear from the findings that technology is a big disruptor in the insurance sector, but CEOs seem to be divided in their approach. Regardless, a ‘do nothing’ strategy is not recommended. Smart businesses move fast when confronted with disruption, since procrastination can have significant repercussions, as Kodak found when they failed to capitalize on the digital camera they invented.
At InsuredHQ, technology is the focal point of our business. We can help differentiate your offering with our unique products, allowing cost-effective, scalable, data digitization solutions that are tailored to your business. Our secure, cloud-based system is also accessible to you anywhere you can find an internet connection. Contact us today to find out how partnering with InsuredHQ can put you in control of your business data.