It is no longer news that digital technologies are reshaping customer expectations and redefining industry boundaries. Apple now offers a credit card; Uber Technologies is in the midst of entering the logistics sector; Ping An of China has expanded beyond insurance and into everything from healthcare to housing; and Amazon has moved beyond retail and bookstores to such an extent that no sector feels safe from “getting Amazoned”.
As traditional industry borders fall away, ecosystems— and the digital platforms that often enable them—will greatly influence the future of insurers. Our research has found that ecosystems will generate $60 trillion in revenue by 2025—which will constitute 30 percent of global sales in that year. Consequently, many insurance executives are looking beyond industry borders to understand the growing opportunities and threats that come from new partners and competitors in the ecosystems relevant to them, from mobility to healthcare and beyond.
In 2018, we described how the rise of ecosystems and digital platforms offers insurers an opportunity to take on new roles and realise new sources of revenue. Since then, ecosystems have gone from hype to reality: insurers are increasingly aware of using ecosystem opportunities to expand their core business of risk aggregation to prevention, mitigation, and related services. However, many insurers still struggle to build the technological and organisational foundations as well as the necessary partnerships to generate value from their ecosystem approaches. In this article, we focus on the pathway from vision to reality across three stages: strategy, enablement, and value generation.
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