Adapting to Technology Changes will Hold the Key for Life Insurers

By CIOReview | Monday, January 5, 2015
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FREMONT, CA:  Providers of life insurance and annuities will continue to see growth but they will need to leverage technology advances in distribution, underwriting and customer service in order to execute strategies that can get them there, reports 2015 EY US life-annuity insurance outlook.

Ernst & Young (EY) points to the issues that need to be addressed by insurers in order to seize competitive opportunities and face competition from alternative business models among which repositioning of distribution strategies and adapting to digital and internet technologies will be the key.

Consumers are turning to the internet to buy Insurance and saving products necessitating the need for products that take the shape of new distribution models. This change in online access to insurance products demands the incorporation of digital storefront. Complementing this evolving scenario, simplified combination products like, ‘life insurance policy with a long-term care accelerated benefit rider’ will be far more acceptable compared to stand-alone long-term care products.

Agility, adaptability to changing stakeholder needs is of prime importance, and a transformation of internal structures and back office systems is essential to achieve higher levels of operational efficiency that leads to faster response rates. Growth brings in data, and with that comes the critical task of securing sensitive data. Insurers need to adopt pertinent measures to monitor third party providers.

Regulatory environment has seen a lot of change in the post- financial crisis scenario with multiple legislative and regulatory bodies implementing new regulations. As increasing regulatory demands for information may not conform to existing reporting structures, insurers are therefore required to build advanced, integrated technology systems and processes to respond to the information requests.

“With a rise in consumer confidence and personal wealth, prospects for 2015 are generally upbeat. Yet these opportunities are not evenly distributed across the industry. To break into underpenetrated markets with new product solutions and advice models, insurers will need to leverage new technology advances in distribution, underwriting and customer service,” says Doug French, Principal, Financial Services and Insurance and Actuarial Advisory Services, Ernst & Young LLP.