From basic life and health protection to long-term savings and investment, the insurance industry offers a wide range of protection for customers of all ages. Traditionally, insurers and their agents have interacted with customers in person, however with the pandemic and social distancing measures, this practice has had to change. In response, many leaders in the insurance industry have ramped up their digital efforts to optimize the ways in which they engage with customers and ensure they can respond to everchanging market demands.
According to a global report from KPMG, 85% of insurance CEOs think that COVID-19 has accelerated the digitization of their operations and the creation of next-generation operating models.[i] According to our Global Tech Trends Survey, 46% of the digital leaders surveyed in Asia-Pacific said they have accelerated digital transformation plans because of the pandemic. Without a doubt, the insurance sector is faced with the need for rapid digital transformation due to changes in customer service preferences, the emergence of new business models, and the demand to support newly distributed ways of working.
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6 disruptive trends for Insurance leaders
The industry has changed dramatically in the past two years. Faced with the new normal, insurance organizations have been forced to acknowledge macro trends and adopt contemporary IT services that can bring customer-focused delivery capabilities to their users, partners and clients. The trends that we have previously identified and studied include:
- Changing demands: Customers are changing not only their behavior but also their ever-growing demands
- Insurance market revolution: Adapting means transforming – the current insurance market is on the verge of a revolution
- Business disruption: There’s still a disruption taking place in office-based businesses, with remote working becoming the new normal
- Partnerships and alliances: Companies are thriving in new ways through powerful partnerships and alliances
- Persistent digital disruption: Disruptive innovations continue to shape the modern insurance market and industry
- Shifting to risk reduction: Internet of things (IoT) technology is enabling companies to create better strategies to mitigate risk
Transforming ever-changing challenges into opportunities with Interconnection Oriented Architecture (IOA)
As new trends continue to shape the industry, all sections of the insurance market are facing obstacles related to business operations and innovation. These hurdles are created by a lack of digitized procedures regarding information integration, customer service, underwriting and claims processing. At the same time, pressures regarding IT investments make it difficult for insurance companies to seize digital opportunities and solve the challenges they face. The above six disruptive trends reveal the rapid revolution has taken place across the worldwide insurance industry, but new opportunities always come with challenges in terms of flexibility, behavior, and implementation.
To stand out and embrace these changes, technology-led insurance companies need robust and future-ready digital infrastructure to support everyday business operations. This does not need to be deployed in a single ‘big bang’, and can instead be broken down into manageable steps that make it easier for insurers to compete in a cutting-edge future.
Stage#1: Modernize services to enhance/differentiate user experience
It is time to rethink the consumption and management of data in a way that supports new business needs. Leveraging Interconnection Oriented Architecture (IOA®) best practices can enable real-time, secure interactions between people, locations, clouds, data and things to connect disparate platforms at the digital edge. It can also help provide access to enterprise applications and data anytime, anywhere, on any device with network no longer a challenge.
Stage#2: Integrate hybrid multicloud services
There is an increasing need to optimize and secure user connectivity with insurance partners and a wide array of IT service providers to deliver reliable and optimal application performance. Adopting private connectivity to access cloud-based services and applications can accomplish this while also increasing security and minimizing risk. By taking advantage of the protection that comes from using private physical connections, or virtual connections between clouds and users, insurers can enjoy direct connection to multiple cloud service providers and reduce security risks inherent to the public internet.
Stage#3: Scale by integrating new ecosystem partners
Enabling real-time collaboration with partners via a robust digital ecosystem will underpin success and enable digital trade flows between customers, partners and employees. This requires scalable infrastructure that interconnects all participants which is where IOA comes into play. Adopting this cloud-native approach and leveraging “as a service” collaborations are essential for a dynamic, successful future in the insurance industry.
Creating a digital pathway for the insurance industry
To enable digital agility and create capabilities that were previously impossible to achieve, there is no better time than now for insurers to re-architect IT infrastructure with a global partner like Equinix who can power insurers with the interconnection and edge services they need to get ahead of the game.
As the world’s digital infrastructure companyTM, Equinix is committed to empowering customers and digital partners as they navigate their digital transformation journeys with interconnected solutions. Currently, the Equinix insurance ecosystem consists of more than 144 companies worldwide, 1,400+ networks, 2,500+ cloud and IT services providers, and more than 8,000 global businesses. Leveraging a full suite of offerings including Equinix FabricTM, Equinix MetalTM and more, Equinix enables insurers to build direct and private connectivity, gain access to dense industry ecosystems and optimize network and cloud connection. With Equinix, insurers can accelerate the creation of value-added solutions, optimize product delivery and improve service and customer satisfaction.
Digital transformation has taken new paths, developing new concepts that represent the complexity of interconnected industries. Without a solid digital foundation, insurance companies can’t transform at the rate necessary to meet rapid shifts in demand. To build this infrastructure, leaders have to prioritize digital initiatives, using interconnection throughout their digital core, edge and exchange. Equinix will be there, ensuring your transformation journey benefits from the right pit stops and you can confidently step into a dynamic new future.