3 min read
After the massive digital shift last year, insurtech is a more familiar term in the industry. However, what might still be in the shadows is how to best leverage it and create a strategic advantage with it.
The best way, of course, is to team up with an informed partner company. But, other questions arise here: how to decide which company to partner with? What is the criteria for defining a good partner company so the collaboration is right? And once the collaboration has begun, how to integrate solutions within existing processes so it all binds together in a strategic, profitable way?
This week, we explore the answers to these questions.
What is insurtech
According to Investopedia:
Insurtech refers to the use of technology innovations designed to squeeze out savings and efficiency from the current insurance industry model. Insurtech is a combination of the words ‘insurance’ and ‘technology,’ inspired by the term fintech.
While innovation is a continuous process, the term insurtech became popular in 2016 to mark the pressure for insurance companies to adapt to increasing customer expectations through the adoption of meaningful technology.
Therefore, a real insurtech company will provide value by either augmenting existing capabilities to bring significant savings or by enhancing customer experience retention and acquisition.
How to determine the right insurtech company
Once you realize the practical importance and benefits of insurtech, it’s time to bring in a collaborator who can help you build a solution that takes your company to the next level of growth. As you meet, discuss, and interview these potential collaborators on the solutions and strategies they suggest, here is a set of criteria that can help you in recognising the right one:
- Does the solution accelerate continuous improvement?
The suggested solution should be dynamic and self-enriching. It should offer the chance to meet the ever-changing customer needs by identifying improvement opportunities and then implementing quick changes to adapt to such needs.
- Does it provide data-driven insights?
The solution should provide an evidence-based approach and should be able to generate insights about customers and business processes they are subject to. Each decision should have numbers to back its implementation.
- Does it increase customer knowledge?
The solution should give voice to its customers by providing not only customer feedback analysis but also customer demographic and behavioral insights. You should be able to know your customers better because of the solution.
- Is it compatible with your business operations?
The solution should make an existing process more efficient or fill a gap in the current process. In both cases, it should be able to effectively integrate within existing processes without causing major upheaval.
- Does it communicate well with other systems?
The solution should be able to operate within a wider ecosystem which is your technical infrastructure. It should be open to other solutions, systems, and APIs. Additionally, its interface should be intuitive enough so that employees and customers can easily communicate with it.
Each business will have a unique structure so the solution will need some tweaks that are unique to you. If those are thought of and accounted for by the potential collaborator, then it is probably a good fit.
Insurtech can help to drive digital transformation within your organization. The first step is a critical review of existing processes and challenges. The second is to onboard a partner who can help you implement those processes and solve those challenges. For a starter on who you could collaborate with, you can go through this list of the five best insurtech businesses.