Report: Blockchain Forcing Insurance Biz to Re-Think Its Model

Blockchain, News | September 13, 2017 By:

Consulting giant Capgemini has issued a report claiming the insurance industry is being forced to re-think its business model because of blockchain and other technologies.

The World Insurance Report, published Wednesday by Capgemini and non-profit industry body Efma said customers are doing more digital outreach. That, in turn, means any laggards in the insurance industry are at risk of being passed by because of those innovations.

“Customers are seeking more digital touch points for convenience, as customers experience in their daily lives that degree of personalization,” saidKeith Webb, vice president at Capgemini and co-author of the report, during a CNBC interview. “And the insurance industry can’t actually lag behind, although I think that it still is lagging behind other sectors. But certainly it’s waking up to the fact that working in partnership with more insurtech firms – working in partnership with technology firms generally – through their innovation labs now which are fairly common, is definitely enabling more rapid, and more innovative engagement models with customers, that take them into that personalization stage that really customers are beginning to expect.”

Insurtech is a new buzzword for technology that aims to improve the efficiency of the insurance industry. There is still a ways to go before tech overtakes tradition – traditional insurance channels still found favor with 46 percent of consumers, outperforming their technical competitors.

“The factor though that is a drag on customers is the fact that the incumbents currently do have very strong balance sheets, they have been regulated, their brands are well known, there is a degree of trust that they still have – all of those are major assets,” Webb said.

Some 75 percent of senior insurance executives said that developing their own insurtech capabilities would help them meet demand.