Courage called for in the innovation game
12th July 2022Tweet
Insurance leaders need to be bolder in their approach to innovation if the sector is going to get the most out of new technology.
Significant benefits to cost, customer experience and the environment are all possible, but only if key decision-makers are prepared to get behind new solutions and processes that are not yet 100% proven.
This is especially true in terms of achieving sustainability targets.
That was the verdict of a strikingly honest panel debate at ILC’s specialist conference, The Environmental Challenges of Property Claims, which took place at etc.venues in London on 9 June with the support of headline sponsor CoreLogic and sponsors Gateley Vinden, Polygon, QuestGates, RSK Group and JCS Jewellery.
Taking part in the discussion on automation and its potential environmental benefits were Jennifer Greene, Personal Lines Property Claims Operations Manager, Ageas; Laura Lazarus Supply Chain Lead, Property & Specialist Lines Aviva; Brian Ford, Management Consultant and Software Reseller SLVRCLD; and Marco Marambo, Managing Director, Procurato.
Jennifer said that insurers are open to new technology, but in such a competitive market it is not always easy to make a case for investment.
She said, “Insurers have their eyes open to new opportunities in the market. We definitely want to see what’s out there and what’s coming. But there are constraints and sometimes we’re quite archaic in terms of having to put forward a business case, and sometimes measures that aren’t pounds and pence are a less compelling story for boards.”
Laura agreed. She said that making a business argument for untried technology was difficult, and the only way past that was with more testing. However, she admitted that in many cases the industry was still trying to understand exactly what to test.
She said, “We know there is value in efficiency; if we can get things done quicker it’s better for the customer and there will also be environmental gain there as well, but we need to understand what point in the journey automation could help.
“There is innovation out there, but some things are so new they’re difficult to implement because their benefits and end value are not yet clear.”
She continued, “But we need to get better at testing things, we need to work with our supply chain to make a clearer case to our boards and be clear on the overall impact on the claims journey. We’re all signed up to this. We know our organisations will have to change.”
The positive news is that insurers have proven that they can and are changing. The pandemic saw a substantial shift in working behaviours, and Brian Ford urged the sector to maintain that momentum.
He said, “The trajectory of digital adoption was good during Covid, but the velocity since then has slowed down. But what that did show was that decisions can be taken quickly within large organisations. We know change is hard, but we can’t hide behind legacy anymore because we have proven that things can move quickly.”
Marco said that one of the stumbling blocks to greater adoption of automation was understanding how best to measure its impact, which is felt across the business rather than just in one area. He explained how automation affects cost, environmental, and customer service outcomes, which means gaining a clear picture is difficult.
Marco said, “There are benefits to automation, but it has to be done in a smart way. What we’ve found is that insurers that have been more successful are those who have stepped back and taken a holistic view rather than just going in and automating everything.”
But despite the challenges, this is a journey that every insurer will have to go on. Greater automation leads to greater efficiency, and greater efficiency leads to the environmental gains that no company can ignore for long if they want to remain relevant. Marco revealed that 60% of FTSE 100 companies now have ESG requirements directed from the board, while 45% of millennials have already switched brands based on environmental factors.
Many insurers have already proven their commitment in this area, but achieving net zero by 2050 will require continued focus and a willingness to embrace innovation.
Jennifer concluded: “Leadership has to be brave now, because if we don’t try these things we’re going to be slow to make that step-change. We can talk about doing it all day, but we have to walk the talk. This is a real challenge to our investment in this. It is hard now because there is pressure on all parts of our business. But it is always going to be hard. We can do it.”
The event was also backed by ILC Home & Property division Corporate Partners: Carpenters Group; Claims Consortium; CoreLogic; ICAB; Innovation Group; and Sedgwick.Tweet