Representatives of insurance companies worldwide say they know they must innovate, and quickly, if they are to remain competitive. But nearly half of those in a new survey say their employer is not supportive of the level of innovation that current market conditions demand. KPMG gathered online input from nearly 300 insurance executives worldwide, and dug deeper with one-on-one interviews with more insurers.
What the researchers concluded was that a group of innovation-driven insurance companies will likely take the industry lead as others struggle to break out of tradition-bound ways of doing business.
Fully 83 percent of respondents acknowledged the need to innovate internally. But 48 percent said they feared their employers weren't sensing the urgency of the situation. "While insurance executives overwhelmingly know that innovation will drive future competitive advantage and growth, most seem to be struggling to kindle the spark within their organization," KPMG said. The push for innovation is coming from many quarters.
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"Based on experience from KPMG professionals globally, the reality is that insurance customers, shareholders and employees demand innovation," said Mary Trussell, KPMG International's Insurance Innovation and High Growth Markets global lead, and author of the report. "Indeed, they expect it, not only from technology providers and device manufacturers, but also from their insurance providers. Insurance organizations can no longer do 'more of the same' and expect to grow."
While newcomers to the field are bringing with them new competitive tools, processes and services, 40 percent of respondents said they were more concerned about innovative behavior at existing competitors.
But most said they had neither the bandwidth nor the resources to focus on innovation.
"Insurers and intermediaries are increasingly finding that there is no 'silver bullet' to create a more innovative organization; no 'off the shelf' package that drives new ideas," said Gary Reader, head of Global Insurance, KPMG International.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
