Industry urged to emulate Amazon-style model
A $US375 billion ($484 billion) revenue prize awaits insurers worldwide if they adapt their business models to be more customer-centric and fluid, according to Accenture.
Insurance Lead Australia and New Zealand Ravi Malhotra says Australian insurers have made huge efforts to increase competiveness, including collaborating with insurtechs.
But they are still nowhere close to the “living business” model that Accenture believes is necessary to grab a share of the $US375 billion pot.
US online giant Amazon exemplifies the way a “living business” functions, Mr Malhotra says,
“Becoming a living business may be a daunting challenge, but there is little doubt the future of insurance will belong to those companies that make this shift,” he told insuranceNEWS.com.au.
“Living businesses are customer-centric and adopt fluid models and flexible platforms and talent. They have a profound understanding of their customers and adapt and innovate constantly, at speed and scale, to remain hyper-relevant.
“They strive for flexibility, adaptability and simplicity, rather than worrying about ‘being right’ 100% of the time.”
The $US375 billion windfall, available in the period to 2022, includes about $US117 billion ($151 billion) in new revenue streams for personal lines insurers. In the Asia-Pacific region alone, the revenue potential is about $US140 billion ($181 billion), Accenture says.