Insurance on the platform - The positive impact on costs and revenues

 Key points:

• Thin the confines of the box

While certain insurers are making progress in terms of client centricity, digitalization, and innovation, the insurance sector as a whole is still trapped in a conventional mindset when it comes to goods, procedures, and systems.

• Breaking through the boundaries

Insurers may participate in new cost and revenue plays by participating in platform business models and their accompanying ecosystems, which extend beyond their usual business operations.

• A shift in culture

We propose that insurers experiment with platform point solutions, move to a platform-compatible service model, and get serious about unconventional products to improve their future preparedness.

             The adaptation that is hesitant

• The insurance business has never been known for being quick to adapt to new situations. At large-scale industry events, insurers are actively discussing strategic innovation.
• Customer-centricity is becoming increasingly important to many insurers' strategies and real-world activities.
• The Zurich Insurance Group has outlined a high-level strategy that includes a customer-centric approach, simplification, and innovation.
• Zurich has developed a new section called Customer Active Management to help clients with analytics. Artificial intelligence (AI) is used in this area to produce insights from consumer data and interactions.
• The goal is to provide suggestions and solutions that are particularly customized to the demands of the customer. Insurers have become more aware of the impending disruption and are beginning to plan accordingly.
• Platforms, according to more than three-quarters of respondents, are disrupting the traditional insurance value chain. According to the poll, insurers must diversify beyond standard coverage. They want coverage that will assist them to avoid unpleasant occurrences or scenarios in the future.

             Myopia in terms of strategy

• Insurers are still concentrating their efforts on traditional coverage packages.
• Over the next three years, almost all respondents indicated they aim to expand their investment in product innovation.
• Traditional goods, not risk avoidance or rapid assistance, are seen as the major source of value by 85 percent of insurance executives.
• Insurers with fewer systems and less money to spend on system maintenance are likely to be more successful.
• Insurance firms may create unique products to differentiate themselves in new areas, save time-to-market, and provide better customer service.
• Back-end systems can also be used by insurers as a differentiator.

             Acuity of vision

• Many sectors' business executives are already extensively involved in business platforms.
• Platform business models generate the largest percentage of income for the most successful banks.
• Experts believe insurers are aware of the benefits platforms may provide them; all they need to do now is connect the links.
• They advise insurance executives to concentrate on the competitive benefits that participating on a platform may provide.

             Costs are shifting.

• While improving flexibility, insurers can transfer the expense of older systems from fixed to variable.
• Platforms can help executives save money, according to 81% of executives, and they scale effectively, according to 84 percent.
• Most B2B platforms offer pricing flexibility thanks to their as-a-service model.

             Generating income

• Platform involvement provides insurers with a variety of income opportunities.
• Platform business models are more often used to generate income for insurers from end consumers. This might be making it easier to make new connections, allowing for more cross- and upselling opportunities, or enabling new goods and services.
• The ERGO B2B platform was used in the case study.
• Data-based goods have been spoken about for years, but current platform business models make implementation and distribution easier. Insurers in our sample indicate they aim to use platforms to deliver data-based products or services.
• Oscar, a health insurance business, offers data-based insurance as one example.

    How can insurers take use of platform advantages? To get started, we've identified three main stages.

• Overcome your strategic blindness.
• Make sure your company is platform-ready.
• Take unconventional products seriously.

        Here's how you can get started tomorrow for even faster results:

• Determine your existing product portfolio and who is purchasing them.
• Make a decision on your actual differentiators.
• Determine your sales and profit targets for the future.
• Determine if your existing buyers are capable of achieving these goals and, if not, who you need to recruit.
• Find or create a platform that uses artificial intelligence to attract the consumers you want to your items.