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Insurance in 2016 fell by 8%. Recovery? Innovate please!

According to Accenture, the solution to oppose the insurance market crunch is called living services, a new way for insurance, customer-centric and leveraging on technologies and partners
Donatella Cambosu

2016 was not a good year for insurance: total premiums collected in Italy stopped at 134 million euros, a decrease of 8.8% on the previous year (largely in the life insurance business), and a negative trend of prize collection for 2017 to boot.

All this is included in the Accenture’s  “Global Insurance Distribution & Marketing Consumer Study 2017”.

Looking at the international performance we can say our country is not the only one: whilst the total collection of insurance premiums grew worldwide by 3.1% in 2016 (vs + 3.8% in 2015), it should be worth noting that within the statistical average there is the slowdown in the first-country market and a very strong thrust from countries like China that over ten years has gone from the 16th global insurance market to the 3rd one, with $466 billion in 2016, almost the same size as the second market, Japan ($ 471 billion).

Again according to Accenture, insurtech is growing worldwide, recently with performance even higher than fintech: between 2014 and 2016, investment in insurtech grew by 38%, while those in fintech by 32%.

This is therefore the pressing issue: how to catch up? How to win back the trust of potential customers and respond to their changing needs? How to pick up new consumers?

According to Accenture, companies need to develop a more direct and functional customer experience. 60% of Italian consumers would like to have a multichannel interaction both physically and digitally with their company, and 50% of the sample would like to contact it immediately if needed, for example through a mobile device.

Accustomed to the highly personalized services provided by the big internet companies, insurance companies are expected by consumers to provide a range of solutions likewise responsive to their needs: 63% of consumer would like to receive information on how to reduce driving risks, and 58% on how to reduce daily life risks.  To get such a customized services, the majority of respondents (61%) states to be available to share their personal data.

Traditional companies must therefore transform their business model trying at the same time to increase the profits of the existing core business to support needed investment. Such a change can occur only by adopting a spread digital culture within the company. To represent the company that adopts a customer-centric business model, Accenture proposes the concept of Living Insurer that integrates digital technologies and strategic partnerships with a network of companies: the aim is to transform products and customer relationship into dynamic and active services capable of understanding needs, purposes and preferences by means of relevant and engaging offering.

“In the age of Living Service, ensuring profitable growth will be even more complex for those Companies strictly linked only to conventional business models” Daniele Presutti, Senior Managing Director, EALA Insurance Lead for Accenture said. “The balance between insurance business and investment in new technology trends is thus the key factor for organizations that want to become "partners" of their customers in their daily lives.”


19 October 2017
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