International consultant McKinsey has today released new insights on how insurers can adapt to the post-COVID-19 world, based on conversations with insurance leaders across the world.
The report, entitled “Reimagine insurance:Five keys to innovation”, shares five key steps insurers should take to overcome the challenges created by the pandemic and adapt to the new economy that will emerge:
nsurers around the world have scrambled to weather the sudden disruption brought on by COVID-19. Many were able to quickly adapt to their new reality, from transitioning to remote-working arrangements to embracing digital technologies for customer engagement.
Such sweeping change— for example, several years of digital acceleration accomplished in a matter of months—has the benefit of freeing organizations to embrace new ways of working. Leaders should not miss their chance to push even further for innovation and pursue bold strategies.
McKinsey's senior partners after having discussions with hundreds of insurance leaders from the Asian, European, and North American markets, since the pandemic began,.have weighed in on five strategic factors that could have an outsized impact on innovation in the industry during the recovery and have shared the insights in the report.
Embracing remote working to accelerate the shift to digital –
Insurance executives are now interacting more frequently with their employees via video conferencing platforms, enabling company changes to be implemented quickly and efficiently. Insurers should therefore continue to adopt the remote working model to help accelerate the implementation of new technologies throughout their organisations, in a way that they have not been able to do so before.
Rethinking the insurance operating model
Historically, insurance has been a very relationship-oriented business, but insurers are now having to build and maintain customer relationships remotely.
As a result, the insurance operating model has shifted from a face-to-face to a digital one, meaning insurers will now need to digitise their operating models, from processing applications to assessing claims remotely using the latest imaging technology.
Transforming insurance product development and distribution
As the world comes out of the pandemic, product innovation and distribution will be a big priority for insurance CEOs. Product developers will need to switch to creating products that meet the immediate needs of consumers and businesses across Asia, using multiple sources of data to ensure they have the insights to create tailored products for their clients. Also, they will need to make sure customers can receive products digitally.
Attracting greater talent and diversity within the workplace
By embracing remote working practices, insurers will be able to attract the technical and software engineers they need to accelerate their digital journeys.
The ability to work remotely will also help create greater diversity and inclusion, as several surveys have shown that a company’s ability to attract and retain women, for example, is much higher if it offers flexible working arrangements.
Adopting ESG principles
– During times of crises, insurance is meant to be a stabilising force for society. To reinforce this image, insurers should look to adopt ESG principles throughout their organisations to make sure they are creating a better world for all.