Since 2013, Accenture has been surveying leading compliance officers in insurance and across financial services. The 2018 Compliance Risk Study shows a continued trend towards innovation-fueled compliance strategies, as insurers adapt to the changing risk management landscape in a digital era.
The 2018 Compliance Risk Study identified key obstacles to the compliance function achieving its strategic goals of becoming a risk advisor, regulatory change overseer, and surveillance agent. The most notable of these obstacles are a skills gap and lack of data quality. Emerging risks, such as the proliferation of virtual currencies, require a proactive, modular approach to digital transformation. Failing to implement such an approach may hinder insurers’ growth.
We’re seeing industry leaders adopt a mix of three investment approaches to insurance compliance: building in-house capabilities, buying end-to-end solutions and subscribing to managed services and industry utilities.
BuildInsurers are focusing on designing and delivering their own proprietary technologies. While this strategy can help compliance functions maintain close oversight of end-to-end controls and provide additional career opportunities for in-house compliance officers, our study found only 42 percent of respondents across financial services favored it over leveraging third-party solutions.
BuyFifty percent of the study’s respondents said they intend to invest in proven end-to-end solutions from third parties that can bundle plug-and-play technologies, innovation and skills resources. However, it can be hard to navigate the growing pool of vendor choices.
SubscribeSubscriptions allow insurers to benefit from commercial flexibility and the shared cost of ownership across peer organizations. These services offer a much shorter time-to-implement and can lower organizations’ software, hardware, and human resources costs.
No single strategy emerges as the best. An integrated strategy that combines approaches can position compliance functions to achieve their desired outcomes while remaining agile. An innovation-driven mindset regarding operating models, technology and talent is key as insurers work to maintain focus amid increasing volatility and complexity. Read more about the 2018 Compliance Risk Study: Comply & Demand.