Insurtech Connect Asia assembled a panel of tech and insurance experts to discuss the rapid evolution of digital ecosystems in the Asian insurance space.
From improving speed and efficiency in insurance placement, distribution and claims settlement to bringing insurance to consumers of e-commerce, payment and ride-sharing networks, digital ecosystems are revolutionizing the way insurance solutions are delivered.
Moderating a panel of speakers from Swiss Re Corporate Solutions, Aviva Singlife, ZA Tech and bolttech, Jonas Thürig, Head of F10 Incubator and Accelerator in Singapore, pointed to Accenture’s definition of an ecosystem as a digital network that generates greater value than the combined value each of its players could contribute individually. In an insurance context, insurers, brokers and tech providers are uniting in digital ecosystems whose vastly improved connectivity is helping address long-standing inefficiencies and deliver a wider range of faster, more flexible products to customers.
“Ecosystems offer us access to customers through different channels, generate a wealth of structured data and create opportunities to innovate beyond traditional insurance solutions,” explained Jonathan Rake, CEO, APAC, Swiss Re Corporate Solutions.
They also help build resilience among participating companies and their customers, Rake argued, with companies able to differentiate within these ecosystems much more likely to be sustainable and less likely to be commoditised or replaced.
Ecosystems also help insurers maximise the acquisition cost and lifetime value of customers, argued Melissa Wong, Group Chief Digital Officer of bolttech, who claimed some participants in bolttech’s ecosystem of around 150 insurance companies have increased customer lifetime values by up to 20% while underwriters enabling third-party policies to be sold on the platform have sold 1.6 times more products on average.
Above all, ecosystems help deliver solutions at much greater speed, with George Kesselman, Head of Commercial at ZA Tech, suggesting products that used to take a year to design are now developed in a month or a matter of days. “Velocity of experimentation, testing and learning, and of succeeding and failing, are better measures of an ecosystem’s value than revenues generated,” he argued.
So how do companies join or even build their own ecosystem? According to Walter de Oude, Deputy Chairman of Aviva Singlife, an ecosystem should, first and foremost, be designed to optimize the customer experience, while also giving insurers the agility to deploy a mix of components as their needs change due to the rapid pace at which technology is evolving.
The right tech must be combined with the right talent, partnerships between insurers, brokers and vendors, and a modular approach that allows the ecosystem to serve multiple potential use cases, speakers suggested. Incumbents also need to move away from the mindset of building everything themselves and embrace collaboration over competition, they agreed.
“Some insurers feel apprehensive of being next to competitors within an ecosystem, but they need to think about what is right for the customer,” asserted Wong. “If two traditional competitors playing together adds more value, you are probably doing the right thing.”
As well as the insurance industry developing ecosystems of its own, insurance will play an increasing role in other emerging ecosystems, with Rake highlighting e-commerce, digital healthcare and manufacturing as three areas to watch. “These marketplaces continue to grow, expand and identify smarter ways to add value to customers,” he said.
Asia boasts economic growth and large populations with high levels of digital adoption and innovation – but also customer needs that are yet to be fully addressed, Rake pointed out. “That’s a strong recipe for growing ecosystems, and we will see a lot of innovation in this region going forward.”