Threats and opportunities for Irish insurers
In recent years, Irish insurers have mostly been spared the profound disruption suffered by many other industries, from retailers and print media to taxi and hospitality operators.
The result? Not surprisingly, as reflected in our survey results, insurance leaders do not consider the competitive threat from digital challengers to be as acute as their counterparts in some other industries. Indeed, many regard new regulations as posing a bigger challenge to the insurance industry than Insurtech start-ups.
These views help explain another key finding of our survey: Irish carriers have been investing only modestly in innovation, and plan only modest further investments over the next few years. But will this be enough? There is no guarantee that the Irish insurance sector will remain in its current state.
Whether insurers see the future in terms of disruptive threats or disruptive opportunities, this is not a challenge that can be addressed through innovation investments alone. Nor is there a single technology that can guarantee success. Instead, our wider research recommends an approach centred on “innovation readiness”: the ability to innovate fast and effectively in response to whatever constellation of threats and opportunities the future brings. Our surveys across 2019 and 2020, evaluated Irish insurance businesses on three key horizontal capabilities to help determine their levels of innovation readiness, 1. Innovation structure and strategy 2. Talent and 3. Start-up engagement. Our findings suggest that Irish insurers are performing well in some regards and could further build out their capabilities in others.
Set the disruption agenda for Irish Insurance
Now is the time for insurers to truly harness innovation and radically rethink their role for the future. Carriers need to be proactive and act as disruptors before they are disrupted. They need to explore new ways to engage and serve their customers, to re-imagine their product and service offerings, and to foster new ways of working for their employees. Our research shows that the appetite is there among Irish insurers to embrace this change.