Insurers are investing less than many of their counterparts in other industries in essential digital technology. They’re also achieving lower financial returns on this spending.
The few insurers that are generating good financial returns from their investments in digital technology have a big advantage over their competitors. They have grown revenue 64 percent more than other insurers that have invested heavily in digital technology and achieved a 48 percent better return on equity.
By changing their business strategies and emulating these Digital High Performers, many insurers can significantly multiply the returns generated by their investments in digital technology. Underwriting profits, for example, can be increased 100 percent. Key steps include:
Measure digital progress
Focus on the digital multiplier
Balance digital investment
Rapidly share successes
"Only 5 percent of insurers have been able to couple significant investment in digital technology with strong financial performance."