loading
The latest developments across the P&C insurance industry regarding fraud, risk and compliance.
25 August 2016

Insurtech companies feared by insurers

Insurance companies worldwide are pessimistic about the way they deal with technological developments and changes in customer behavior. This is one of the findings from a recent study by KPMG. Nearly half of the questioned financial institutions expects to lose a lot of revenue to fintech or insurtech companies the coming years. Insurers acknowledge that they do not focus enough on the (digital) transformation that is vital to safeguard the company’s future.

Revenue lost to insurtech companies

Insurtech-companies-feared-by-insurers The urge to adapt is greater than ever. Insurers are aware of the challenges they face and are willing to change. However, it takes more than just a positive attitude to align the business model with today’s society. A lot of organizations claim that they have difficulties to extract value from in-house transformations and lack the knowledge or experience required for effective change management.

Research by PWC confirms that the insurance sector strongly fears ‘insurtech’ companies. Established insurers expect to lose 20% of their revenue to new entrants over the next four years. A shocking indicator that supports this claim: more than half of the interviewed firms has no clue what to do with blockchain technology.

What to do with blockchain technology?

The ‘lack of interest’ is remarkable because the impact of this technology on the financial world is potentially enormous, as blockchain automatically guarantees the validity of transactions. Insurtech company Everledger uses blockchain technology to register diamond certificates and their transaction history. This enables insurers to easily verify the authenticity of a certificate or a transaction. It significantly shortens the process of checking customer information and looking for the truth.

Anticipating on current trends

The findings furthermore show that most traditional organizations believe insurtech companies are particularly powerful in responding to changing customer demands. For insurers this means that insurtechs better anticipate on current trends; offering direct insurance, insurance based on actual use, such as pay-as-you-drive or pay-how-you-drive policies, and intuitive mobile apps that give customers full control over financial products and services.

Another growing development is software taking over from management. Some respondents believe that data, coming from all angles within the organization, is much more powerful than a small group of people in a boardroom. In many companies, software is already making daily management decisions. Insurers can take advantage of this and improve the customer experience by transforming parts of their daily operation to straight-through processing (STP).

Competition from other industries

Insurers-fear-insurtech-companiesNot only insurtech startups are impacting the insurance business. Competition from other sides is also on the rise. Car manufacturers are compensating decreasing profits on vehicles by expanding their lines of business, for example to insurance. GM is already making a lot of money from it. And while John Deere is well-known for its agricultural machinery, the company rather sees itself as a software supplier with a lot of iron around it. John Deere is keen on gathering customer data and using it for expansion of the product portfolio, including insurances.

Examples like these are numerous. They underline the need for insurers to shift their focus. However, it does not mean that insurance companies should reserve a lot of resources for development of software or in-depth knowledge about topics that are far from the core business. Instead, insurers should be making smart choices.

Use insurtech for the better

Examples like these, and many more, underline the need for insurers to shift or prioritize their focus. This does not mean that organizations need to spend lots of resources on building software or developing expert knowledge themselves. However, they should make smart decisions. Instead of fearing new insurtech entrants, use them for the better. Now is the time for insurers to strongly invest in their cooperation with insurtech companies, so they can improve their business proposition continuously and keep up with the game.

Consulted sources: KPMG, PWC, Everledger

 

Contact us

Cookie and Privacy Policy

1. Introduction

When you use this website, FRISS may collect information about your use of the website and the content offered. We believe it is important to handle your (personal) data with due care and confidentiality. When processing your personal data, we comply with the General Data Protection Regulation (Algemene Verordening Gegevensbescherming) and Article 11.7a of the Telecommunications Act (Telecommunicatiewet).

1.1.  Controller

The controller of the processing of personal data is:

FRISS Fraudebestrijding B.V.
Orteliuslaan 15
3528 BA
Utrecht

This processing of personal data is registered with the Dutch Data Protection Authority (Autoriteit Persoonsgegevens) in The Hague under reporting number m00004997.

1.2.  Purposes of data processing

There are several places on our website where you can fill in your (personal) data. We will explain the purposes of the various instances of data processing below.

Filling in the contact form or sending an e-mail

If you fill in the contact form on our website or send us an e-mail, we will only use the (personal) data you provide for the purpose or purposes for which you filled in the contact form or sent the e-mail.

Download form

If you download files on our website (such as e-books, whitepapers or reports), we will use the (personal) data you provide for one or more of the following purposes:

  • for the execution of an agreement, for example to send you the e-book, whitepaper or report you have chosen;
  • for the formation of an agreement, for example by contacting you by telephone or in writing.

Newsletter

If you fill in the application form for the newsletter on our website, your (personal) data will be used to send you the newsletter. Each newsletter contains a hyperlink at the bottom of the message that you can use to unsubscribe.

In addition to the personal data you provide to FRISS yourself, FRISS may collect, record and process additional (personal) data if you use the (web) services of FRISS. This concerns the following personal data:

  • data from the used equipment, such as a unique device ID, version of the operating system and settings of the device you use to access a service;
  • information about the use of a service, such as the time at which you use the service and the type of service that is used;
  • location details from your device or derived from your IP address that is provided to us when you use a particular service;
  • data available from external sources. We may receive information about you from public or commercially available sources.

1.3.  Provision of (personal) data to third parties

Your (personal) data will never be provided to third parties without your permission, unless we have an obligation to do so pursuant to legislation or regulations or you have given permission for this.

1.4.  Security of data

FRISS respects your privacy and ensures that personal data are handled confidentially and with the utmost care. All processed (personal) data is stored exclusively in secure databases. These databases are only accessible to employees of FRISS, to the extent that this access is required by virtue of their position. FRISS makes every effort to secure these systems against loss and/or any form of unlawful use or processing.

1.5.  Inspection, correction and deletion of data and the right to object

You can view your data that is processed by FRISS at any time and free of charge and, if you so wish, modify this data or have it deleted. You can also object to receiving information about products, services or content of FRISS. If you wish to make use of one of these options, you can send an e-mail to the Data Protection Officer of FRISS via privacy@friss.eu or write to the following address:

FRISS | fraud, risk & compliance
Attn. Data Protection Officer
Orteliuslaan 15
3528 BA Utrecht.

2. Cookies

When using this website, information about your use of these services and other websites may be collected by or on behalf of FRISS, for example by means of cookies.

A cookie is a small file that is sent along with pages of a website and stored by your browser on the hard disk of your computer. We use cookies to remember settings and preferences. You can disable these cookies via your browser.

2.1.  The purposes for which FRISS uses cookies

On our website we use cookies for the following purposes:

  • for statistical purposes, in order to analyse the use of FRISS websites. This allows us to keep track of the number of visitors and see which parts of our website are popular. We use Google Analytics in order to track and consult these statistics. On this website you can find explanations about all cookies that may be placed by Google;
  • for what is known as ‘targeting’ purposes, if you have used the download form. By targeting we mean building a profile of you based on your surfing behaviour on our website, after which we may contact you by telephone or e-mail based on the interests you have shown in order to offer you FRISS services that you may be interested in. We use HubSpot in order to track and consult these statistics. On this website you can find explanations about all cookies that may be placed by HubSpot;

3. Changes to this Cookie and Privacy Statement

FRISS may make changes to this Cookie and Privacy Statement. All modifications will be published on this page. We advise you to consult this Cookie and Privacy Statement regularly, so that you are always aware of the content of the current Cookie and Privacy Statement.

 

Subscribe