Thriving in the coming insurance industry transformation – KPMG
Article Synopsis :
As Warren Buffett, owner of GEICO, put it recently, “If you could come up with anything involved in driving that cut accidents by 30, 40, 50 percent, that would be wonderful. But we would not be holding a party at our insurance company.”
In “Thriving in the coming insurance industry transformation”, Tom Nodine of KPMG outlines driverless cars and other major challenges threatening the U.S. Insurance industry. Namely:
- Reduced losses and premiums
- Lower operating costs
- Growth in digital customer interactions
- Risks from cyber security and new business models
- Data monetization
The report suggests five practical actions insurers can take to thrive as the industry transforms:
- Develop your own view of when and how technology will impact your company
- Develop new strategies to thrive as the industry transforms
- Leverage new technologies in your current business as appropriate
- Mitigate key risks by investing in cyber-security and experimenting with new business models
- Decide what role you will play in industry consolidation
Answers depend on competitive position, strategy, and other factors including facility with new technologies, balance-sheet strength, and core mission, beliefs and principles.
Link to Full Article:: click here
Digital Insurer's CommentsAs the world waits for driverless cars, the Highway Loss Data Institute tells us ‘accident-less’ cars, i.e., those equipped with accident avoidance technologies (such as Subaru’s EyeSight), are already driving accident rates down 40%.
In the short-term this boosts carrier profitability; but in the long-term premium always follows experience. Can you survive – or thrive – in a reduced-premium environment?
This paper does an excellent job helping you think through the various components of your response.
Link to Source:: click here