A Snapshot of Innovation: Insurance Market Scan for 2009
Innovation requires some leaps of faith, but could have some significant rewards.
In a new report, A Snapshot of Innovation: An Insurance Market Scan, Celent takes a closer look at examples of innovative application of technology in insurance. Insurance organizations have risk aversion in their DNA, but there is more innovation than the industry is given credit for. The use of telematics in pay-as-you-drive insurance is a great example, as is price optimisation among UK insurers. This report will provide several examples of technologies that are being used to create innovation in product and process.
"It may seem like a peculiar time to talk of investing in innovation, given the backdrop of the global financial crisis” noted Catherine Stagg-Macey, senior insurance analyst and coauthor of the report. "But there is remarkable interest in using innovative technology to achieve business objectives."
The report discusses in some detail applications for the smart phone, digital pens, social marketing with social media, and digital assistants. The business case behind many of these initiatives is unclear. Innovation requires a leap of faith, more in some areas than others. There remain several unknowns in all the initiatives, such as consumer behaviour in social networking or adoption rates of smartphones and their applications. Few of the initiatives in this report are today able to create a high impact on the business process.
"There will be leaders and followers in innovating business processes,” noted Nicolas Michellod, senior insurance analyst and coauthor of the report. “CEOs and CIOs need to be clear on which category they want to be in. Leaders could reap benefits for early investment in an innovation that gains broad acceptance, but could also bear the costs with minimal benefit if it does not work."
The report will hopefully stimulate ideas for the reader and present some new and interesting ideas that are worth exploring.