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Share the Future or Fight Over It

Denise Garth | July 14, 2014

Once again, IASA was a busy and engaging conference for the insurance industry. With a record number of exhibitors, strong attendance, engaging sessions, and a headline keynote speaker, the participants were provided with a great opportunity to garner insights into the challenges and opportunities of our industry. But it was a statement made by President Bill Clinton in his keynote speech that really caught my attention: “Share the future or fight over it.”

As an industry, we do have a history of sharing and collaborating at industry events, in industry workgroups, in industry meetings, and more. This has benefited our industry and its individual companies, both separately and collectively. 

But as an industry, we need to raise the bar and ratchet up the “sharing” in order to be successful in this fast-paced, changing world. Other industries and businesses are changing all around us and seeking to create and develop new business and revenue models that will encroach upon and challenge insurance. By raising the bar and ratcheting up, I mean that we must embrace open innovation, collaboration, crowdsourcing, and ideation with new standards and at higher levels within companies, within the industry, and even between industries.

The topics of innovation, change, and emerging technologies were the focus of this year’s IASA industry analyst panel. I had the pleasure of representing SMA, and as I prepared for the panel session, I found myself taking a step back and looking across the many topics and discussion points. I realized that when leveraging the vast base of SMA research and insights and blending it with the broader strategic business implications for the industry, a powerful story emerged.

A wave of change, disruption, and innovation has hit our industry with a speed and intensity that we didn’t quite expect. And that is why SMA has become so focused on innovation the last three years, because it will define the future winners in our industry.

In the spirit of sharing, for those who did not attend, here is a summary of my rapid-fire, two-minute responses to the analyst panel questions to help inspire you, challenge you, and get you to embrace collaboration as an industry to help you define your future in the industry.


Innovation is happening all around us. We are at the forefront of what is probably the greatest disruption in history: the digital revolution. And it is affecting every industry. This revolution is fueled by the breadth and depth of the new technologies that are changing customer engagement, transforming products and services, redefining business and revenue models, and breaking down barriers to new entrants.

Look at the Apple iPhone, introduced seven years ago, and the resulting disruption, destruction, and construction of industries and businesses. Today, the bar is set at a new high. Operational excellence is an absolute. Innovation is the price of problem solving and strategy enablement for future success. And the Next-Gen Insurer is being defined and shaped in the process of all of this.

Embrace open innovation and an ecosystem. Insurers must have a strong culture that combines the power of open innovation with an ecosystem that empowers collaboration, sharing collective intelligence and ideas that can accelerate innovation, because change has happened faster than most of us thought it would or were ready for. As President Clinton warned, “share the future or fight over it.” If we don’t define our own future as an industry, other industries may try to step in and define it for us.

It is about the constantly connected customer. We all must recognize that in this digital revolution, the customer is in control and is defining the channels that he or she wants to use—from purchasing through service. As insurers seek to become digital insurers, they must have unified digital strategies that create seamless, consistent, and connected customer experiences across all channels in an omni-channel environment. Think like Google, Zappos, Apple, Nike, AT&T, and others that are the new digital leaders.

Product development and configuration are key differentiation levers. These capabilities are shaping today’s competitive landscape, with speed to market of paramount importance. The pressure to stay current, deliver new offerings, and price accurately is driving many insurers to seek innovative solutions. The average new product implementation timeline is nearly 7.5 months. Less than two percent of insurers are able to implement in less than 30 days. But some innovative companies have found a way to implement in less than five days. Another emerging capability of even greater importance is the enabling of product co-creation. Customers can help to configure their own products according to their wants and needs.

Usage based insurance (UBI) is not just about product; it’s a whole new business model. UBI moves the focus from risk assessment to risk prevention. And its application is much larger than auto insurance. It is about the connected car, the connected home, and the connected life. UBI is the precursor of a broader impact of sensors and the Internet of Things that will allow us to connect the dots between data for new customer products, services, outcomes, and experiences—providing a real-time view of risk. 

Data and information are the new currency in the digital world. Data has always been seen as the lifeblood of the industry, but its strategic value is at the forefront in this new digital world. And big data, BI, and analytics are steadfast as top priorities and continue to take the insurance industry by storm. But what is holding insurers back (and will be a significant detriment in the new digital world) are the lack of a data management strategy and a deficient level of data mastery maturity. Both strategy and mastery will be needed in ample supply to unlock the full business value of data, whether transactional, unstructured, internal, or external. 

Cloud is increasingly mainstream because that is where the data is moving. Cloud adoption has grown very rapidly. Two years ago it was an option in core system RFPs, whereas today it is increasingly a preferred choice. And cloud is important as an enabling technology, particularly where the Internet of Things is concerned. The future will be the Cloud of Things, a world of distributed data, devices, technology, intelligence, computing, etc. that is highly connected and will enable the creation of new products and services.

It’s about “customer empowerment,” not "customer centricity." Customer centricity is a 1990s/early 2000s term, and is only a subset of the bigger customer empowerment focus. We used to shape the customer experience; now it is shaped for us by the rest of the world. Customer empowerment defines new engagement models. As customers gain market power, they are increasingly comfortable with technology, have a stronger voice, and use it to demand collaboration. Insurers must view all technology as customer touching, because it influences the customer experience, both directly and indirectly, ultimately shaping and defining the customer relationship.

As an industry, we are seeing challenges to our long-held beliefs, assumptions, and business models coming at us every day. Technology is creating new experiences, new products and services, new outcomes, and new business and revenue models that were not possible a few years ago. Replacing our legacy systems with new, modern core systems is now table stakes, providing a critical foundation that allows you to enter into the game. Just like the iPhone provided a platform of possibilities, ingenuity, and innovation, core systems—integrated with an array of new technologies like mobile, social, Internet of Things, cloud, big data, analytics, driverless vehicles, biotechnology and much more have the potential to transform our industry and to do it on our own terms. 

So be inspired.  Be creative.  Be collaborative.  Be bold.  Let’s create and share the future together.

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The Email Chat is a regular feature of the ITA Pro magazine and website. We send a series of questions to an insurance IT leader in search of thought-provoking responses on important issues facing the insurance industry.


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