Distribution is the fastest changing facet of property and casualty (P&C) insurance. Digital technologies, in particular, mobility, is creating disintermediation of the traditional insurance distribution model. How can carriers catch up to insurtechs, not just from a technology, but a strategy perspective? This report focuses on the key considerations that insurance technology and strategy leaders need to bear in mind to create differentiated, mobile-first distribution networks. To stay relevant as an insurance carrier in the next few years, you need to go beyond the app when addressing opportunities in mobility.

Mobility emerges to disrupt insurance distribution

With advancements in both consumer and enterprise technology, every aspect of insurance is changing. Customers, particularly in personal lines, expect the same superior interaction and engagement from their carriers as they do from consumer-focused industries (see published HFS piece, “How Insurtechs Must Embrace Insurtech To Win on Customer Experience”).

The industry has been slow to adapt to consumer shifts, which especially impacts distribution. Often the distribution channel represents the face of the insurance brand to potential customers. Insurtech disruptors have been quick to exploit this opportunity in the last three years. Insurtech investments skew disproportionately toward the distribution part of the insurance value chain. Mobility is arguably the single biggest evolution that insurtechs have brought to the table. As Exhibit 1 illustrates, mobile apps are becoming more pervasive in the industry, based on an HFS study of 50 P&C insurance executives in North America in Q2-Q3 2017. Nearly 72% say that enterprise mobility is critical or increasingly important among key digital technologies. On the flip side, more than a quarter (26%) consider mobile apps to be an “emerging” priority, further illustrating the industry’s disconnect with consumer shifts and the need for disruption.

The value proposition for some of the biggest disruptors is the instant engagement, personalization, and anytime-anywhere convenience that mobile channels offer customers. Trov, a Silicon Valley company primarily working in Australia and the UK, is an example of this trend. Trov’s app lets customers turn protection on and off for their insured items with a few taps, and the app processes claims automatically within minutes.