Like companies in many other industries, insurance firms wanting a competitive advantage must offer tailored digital solutions and an exceptional customer experience.
To achieve these goals, the world’s leading insurance market, Lloyd’s of London, recently proposed Blueprint One—a plan of six solutions they predict can cut administration costs for most risks, from 30-40% today to 10-20% in the near future.
These solutions include a “risk exchange” that provides new, convenient and low-cost ways to carry out global risk procurement for high-volume risks and a “complex risk platform” which will allow specialty risks and associated data to be brought into the market in a standardized way.
Key features of the risk exchange’s initial rollout include a flexible interface that connects to existing distribution systems where possible, a user interface where notand centralized ‘trading’ functions (e.g., a search and match engine). There will also be a set of back-office systems to support and standardize processing and reporting.
For this platform to run seamlessly, it will require a robust and secure digital infrastructure that can interconnect all the moving parts and handle the massive amounts of data being transferred.
A digital approach
To achieve this and take advantage of the new digital ecosystems being created, it is business-critical that companies move from traditional, siloed IT systems to flexible, scalable and secure digital infrastructures that enable the movement of massive amounts of data in real time.
In turn, this will ensure firms satisfy the demands of the digital-savvy customers increasingly through apps and other platforms to leverage insurance services.
This migration will also enable insurers in all sections of the market, from personal and professional insurance to reinsurance, to move their services to the digital edge—a location geographically close to major insurance hubs where the physical and virtual world meet. Physical location remains key when it comes to data transfer as the closer you are to your customers, the faster you can transport, process and analyze their data to obtain valuable insights.
The smarter solution
This solution is achievable by leveraging an Interconnection Oriented Architecture® (IOA®) to directly and securely connect people, locations, clouds and data on Platform Equinix®, the world’s largest global platform of interconnected data centers and business ecosystems.
In addition to shifting the delivery architecture closer to its users, adopting such a centralized and distributed interconnection platform also enables insurance companies to offer:
- reduced risk.
- personalized digital experiences.
- optimized processes via single platform standardization.
- business scaling through data-driven insights and diverse ecosystems.
- standardized control and governance, tailored to local needs.
In fact, according to the Forrester Total Economic Impact™ (TEI) study, clients that have adopted Equinix IOA—many of whom sit within the insurance sector—and deployed services at the edgesaw a 328% return on investment, 30% minimum latency reduction and a planning and implementation time of six months.
Navigating the disruption
Throughout the 350+ year history of the insurance industry, there has never been a more obvious need for the trade’s major players to adapt to a rapidly diversifying business landscape.
Once an industry reluctant to change, the emergence of new challenges is forcing insurance companies to introduce new systems and applications required to support its new innovations. The sector has previously proven that it can transform its business model to remain relevant and will undoubtedly do so once again, however, this time it will take a concerted effort from the industry’s leaders to leverage the next-generation digital infrastructures that will enable the sector to reach its full potential.
To learn more about how insurance ecosystem participants can accelerate their transformation and delivery of capabilities via a distributed interconnection platform at the digital edge, download the Equinix Insurance Playbook.