Cloud computing will become a common technology in the insurance industry over the next decade, according to a survey by Sollers Consulting.
Robotic Process Automation (RPA) is seen as more important in the market than Artificial Intelligence and Machine Learning, while Telematics and the Internet of Things are weighted comparatively low.
The survey showed that over eight of the top ten insurers in the markets will rely on cloud and robotic process automation (RPA) by 2031.
Artificial intelligence and machine learning will also be important, but they score slightly lower than RPA. While open APIs are almost as important, the Internet of Things (IoT), telematics and blockchain are not seen as top issues in the insurance industry. That’s the finding of a survey of insurance industry executives and professionals by Sollers Consulting.
Michał Trochimczuk, Managing Partner and Co-founder of Sollers Consulting said: “The willingness to innovate is widespread, and innovation will impact critical functionalities. Insurers will form more partnerships. To modernise their IT, they will rely heavily on cloud solutions.”
Insurers are very keen to invest, particularly in Germany, while in Poland the willingness to invest in innovations is significantly lower.
None of the survey’s respondents state that their company is not willing to invest in innovation, and only 2.6% of the respondents state that they will invest only slightly in innovation.
Marcin Pluta, Managing Partner and Co-founder of Sollers Consulting commented: “The differences in attitudes toward innovation across markets could be related to the different levels of digitalisation and awareness of disruptive power in each country.”
“Aggregators have changed the insurance industry from a technical perspective as well. Insurers have been forced to develop solutions to serve price comparison websites very quickly. Speed and price have become more important in the insurance business. This is still a challenge for insurers.
“Insurance industry professionals know that cloud ensures greater business agility and operational effectiveness. Both are becoming increasingly important in the era of integrated and intelligent ecosystems.”
“Banks and insurers are making great efforts to digitalise insurance sales. However, to be successful in doing so, they need to implement flexible insurance platforms that enable them to respond quickly to changing markets,” said Trochimczuk.
The survey showed that insurers are paying increasing attention to their core systems, which in many cases lag behind technological developments. Insurance executives and experts are convinced that core systems are moving to the cloud.
It was also found that nationally developed core insurance systems appear to be more important than core systems that are developed internationally.
Trochimczuk continued: “In the view of globalisation, the national mindset in this area may be surprising. But insurance is still a very country-specific business. Regulation is one of many reasons for this.”
The speed of digitalisation has not yet reached its limits, and there are clear signs of this, summarises the Sollers report. While the insurance industry talks a lot about data-driven business models, the value of data is only used in very isolated areas. 5G will increase the amount of data available. For insurers, it is a challenge to use it. Industries such as gastronomy, tourism and media have been greatly changed by the internet.
“The products have not changed significantly, but the way they are offered and sold is completely different. I am convinced that the same will happen in the insurance industry. It will even go further,” Trochimczuk added.