< Study Room | 06.11.2017

A-Z OF… INSURANCE INNOVATION

A-Z OF… INSURANCE INNOVATION

Tim Grant, of Covéa Insurance, takes an A-Z look at the digital revolution…

There is a lot of excitement about innovation in our industry right now, so much so that it can sometimes feel like a very recent phenomenon. But the opposite is true. From a business perspective, innovation is the process that sees ideas generated and developed into goods or services, either creating value or for which customers are willing to pay, with the innovations typically meeting a specific need or problem.

Our industry has been doing that for hundreds of years. The coffee shops in The City were a magnet for those in the shipping industry looking to exchange information and gossip; Edward Lloyd recognised people were hungry for as much information as possible and he met this need by holding maritime auctions and collating records in his cafe. A bricks and mortar Facebook, minus photos of cappuccinos and cats. More seriously, this innovation is probably one of the reasons Lloyd’s bears his name today, rather than one of his early competitors. Perhaps he was a Steve Jobs of his time, seeing “killer” solutions in reinvention, as well as brand new ideas.

As an industry, we have been at the forefront of innovation for hundreds of years, developing solutions to meet clients’ risks as they have evolved over that time. So, what is behind the current heat? One word: digital. A digital revolution is underway and it is transforming our lives; at work, rest and play.

There are parts of our industry that have, in the past, been reluctant to embrace technology, but the Luddites are going to have to wake up and smell the coffee. Technology such as driverless cars and connected homes seemed like science fiction just a few years ago. These and other solutions, such as artificial intelligence, robotics and big data, present massive opportunities and threats to our industry, with the exponential rate of progress taking even digital gurus by surprise.

The pace of change is a challenge for our industry, but one that must be overcome. We need to develop cultures and processes that enable innovation to thrive, adopting such concepts as minimum viable products and embracing fast failure. This can be very much at odds with deep-rooted traditions and working practices. Collaborations with startup ventures are one approach many traditional businesses are taking. We also need to attract Generation X and Y people to pursue careers in our industry; they are not screen zombies, they are essential to shaping the value propositions our customers and partners are demanding.

Customers increasingly regard their interfaces with organisations as the most important measure of value; often at the expense of product, with convenience, speed and simplicity key quality differentiators. We are all more demanding and impatient – who would have thought 15 years ago that having to wait more than a few seconds to access the world’s biggest shop, music store or library would be unacceptable? But that’s the world we live in. We can overcome that challenge and ensure our zenith is ahead
of us by embracing digital and continuing to innovate.

KNOWING YOUR A-Z

A – artificial intelligence

B – big data

C – connected homes

D – driverless cars

E – exponential

F – fast failure

G – gurus

H – heat

I – ideas

J – Steve Jobs

K – killer

L – luddites

M – minimum

N – need

O – opportunities

P – problem

Q – quality

R – robotics

S – startups

T – transforming

U – underway

V – value

W – working

X – generation X

Y – generation Y

Z – zenith

Tim Grant is head of small business and commercial schemes at Covéa Insurance

 

Share

Related articles

The art of art insurance

The art of art insurance

Mike Burle, of Liberty Specialty Markets, takes an alphabetised look at fine art insurance

A-Z OF… CAT BONDS INCREASINGLY DOMESTICATED

A-Z OF… CAT BONDS INCREASINGLY DOMESTICATED

Darren Bailey takes an alphabetised look at the ever-more commonplace catastrophe bond

Catastrophe modelling

Catastrophe modelling

Catastrophe models are computer-based models used to estimate the financial cost of natural disasters such as earthquakes and hurricanes.