Future of Life & Pensions – Five digital myths – Grant Thornton
Article Synopsis :
Insurance is a complex business and the emergence of digital is often a new pain point for carriers. Keeping in view the emerging business landscape, insurers need to be careful about the do’s and don’ts while addressing digital transformation challenges.
In the research report “The Future of Life and Pensions: Five digital myths dispelled”, the Grant Thornton team reveal five digital myths within the Life and Pensions industry and highlight that there isn’t a consensus, within the industry or on occasion within individual companies, on what digital means and what the winning approaches will be to address digital challenges. The report challenges these myths about digital that could lead companies into blind alleys and wasted investment. The key myths discussed in the report are:
- Myth 1 – Digital is just another channel
- Myth 2 – Digital is just about technology
- Myth 3 – Digital is not about relationships
- Myth 4 – Digital is optional
- Myth 5 – Digital won’t change my business model
The report also showcases a digital thermometer for the life and pensions sector (shown below) that helps track the change drivers facing the industry, enabling life and pensions providers to think further ahead to gain strategic advantage from unavoidable change.
The report concludes that whilst regulatory changes still take up a large proportion of the agenda, structural and operational change are fast rising in priority.
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Digital Insurer's CommentsDigitisation is well past infancy and has the potential to deliver significant benefits for insurers, from both a cost and revenue perspective.
One of the quotes we like from the report is: “The question is not whether you can implement a digital strategy without changing your business model, but whether digital can help you change your business model to one that is competitive and profitable in the new environment”.
Customers have evolved and are now empowered with a wider range of options and channels where they can reach and connect with insurance providers. This abundance of options, technology, platforms and channels will require insurers to change their business models in order to remain competitive. As insurers embark on their digital journeys, they should address the myths and misconceptions at the outset (such as those that Grant Thornton have highlighted) in order to stand a greater chance of success.
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