"Innovation Is Not a Department Or a Project, It’s a Way of Life"

Kicking off our 'Meet the InsurTech advisors' series, Michael Fitzgibbon, Vice President & Chief Underwriting Officer, Slice reveals his view on where InsurTech is taking the insurance industry and - more to the point - whether it is going anywhere quickly. This series will be host to the leaders of the InsurTech industry and advisory board for InsurTech Rising, 16-18 October in London.

1. What’s the most urgent challenge the insurance industry needs to tackle, and how can InsurTech help?

I think the most urgent challenge is how the insurance industry interacts with its customers, on numerous levels, such as communications, digital presence, speed-of-delivery, ease-of-doing-business and payment systems. The industry is archaic in all of these areas - even the “innovative” players. There is definitely a key role for InsurTech, but it will take much more: a fundamental shift in how insurers approach underwriting. For example, it's currently very difficult to buy insurance. The application process alone is time-consuming and difficult to complete - plus the application can only ever benefit the insurer. InsurTech innovation can certainly digitize and create efficiencies in the application process, but that’s not the right solution. Insurers need to eliminate the application process altogether. The information they need is available through other sources and actually much more reliable than what customers provide. And the part about “Representations and Warranties”? Get over it! While delivery of documents has improved greatly in personal lines and some small commercial lines, it is still not instantaneous, nor are they issued at customer-friendly intervals and lead times. The best example is how the industry has been able to provide renewal documents 45 days ahead of renewal date by issuing them so many months in advance, and at such varying time-frames, that customers have long-forgotten the issue by the time it’s important. The industry can embrace innovation and technology to create instantaneous delivery of insurance policy documents - as in immediately upon purchase. In addition, the option should exist for the documents to be entirely digital and cloud-based. On communications, the industry really needs to improve. This is again a situation that will require better thinking. Technology will be a tool to create customer-centric communications, but the industry needs to listen to customers and communicate on customers’ terms. As for payment systems, the industry needs to offer fully-digital payment options. Not just pre-authorized debits and the acceptance of credit cards. And the time element of payment options should also be more flexible - think past annual or monthly, to weekly or in sync with activities such as mortgage payments, vehicle refuelling and commercial revenue patterns.

2. What one piece of advise would you give industry leaders?

Innovation is not a department or a project, it’s a way of life. Forget about “sandboxes” and “garages”. These concepts put more creativity into their names than into re-focusing the organization. Redesign the entire company around agility and innovation. Appointing a “digital innovation officer” will not lead to success. The industry must think in terms of “digital revolution” across all disciplines.

3. 2017 will be another big year for innovation in insurance: what will be the hot topics at InsurTech Rising in October?

I can guarantee that whatever I predict in April to be the hot topics in October will ultimately be wrong! But here I go anyway: Success Stories - In October 2017 there will be much discussion about the success of the early innovators from 2015 and the growth trajectories they are achieving. Carriers Moving to the Next Level - Many insurers have begun to embrace the innovation concept by creating the aforementioned sandboxes and garages, or participating in innovation marketplaces. I’d like to see that moved to the next level, one where carriers begin to move past innovation as a project to innovation as a business model. Funding - Funding will definitely be a hot topic, I just don’t know if it will be because there is increased capital investment in InsurTech or less capital investment in InsurTech.

4. It’s 2027. How has insurance changed?

Well, this is where I get pessimistic. The existing insurance industry will have changed very little. Insurance itself, however, will have been revolutionized, led by the InsurTech industry and by non-insurance entities.