Innovation in insurance was historically indulged in the periphery of the business, under-funded and watched with expectations of incremental rather than transformative change in business operations or performance.
This has changed. We now hear insurers frame innovation as increasingly strategic, purposeful and critical to their success.
The evidence is all around us. Consider the many innovations in product development and distribution, including embedded insurance, usage- and behavior-based models and the convergence of insurance, health and wellness. The proliferation of insurtechs, each with the promise of a breakthrough, is one of the most notable features of the industry in the last decade. Additionally, in 2020, AM Best first included innovation criteria in its ratings.
The Qorus Innovation in Insurance Awards launched in 2016 with 225 submissions. It has grown as a global industry recognition program and has to date evaluated nearly 3,000 submissions from carriers and insurtechs alike.
To gain a deeper understanding of innovation in insurance, including why and how it happens and what the benefits are, we conducted:
• A generative AI analysis of all the insurance innovation concepts submitted to the Qorus Innovation in Insurance Awards since its inception.
• An online survey with 41 responses from innovation executives representing 28 leading insurance companies across 16 markets. These companies have consistently submitted entries to the Qorus Innovation in Insurance Awards, many of which have earned recognition.
• Structured, in-depth interviews with 11 senior insurance executives responsible for innovation.
Through this research we uncovered:
• Where innovation is focused: Insurance organizations are focusing innovation efforts on product development.
• The payback of innovation: Most innovation initiatives are meeting or exceeding insurers’ expectations in delivering both financial and non-financial returns.
• Challenges confronting innovators: Innovators—particularly in large organizations—face persistent and significant challenges, especially as they accelerate their efforts, including an increasingly complex regulatory landscape and a resistant company culture.
Innovation will be critical to the future of insurance. The demand for better products, improved efficiency and greater personalization will only intensify. We conclude our report with the key enablers of value generation that point the way forward.
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