- In five years, nearly all the insurance executives in our survey expect the industry to be transformed by digital technologies.
- Insurers have embraced this digital transformation, investing strategically and planning for long-term technology innovation.
- Insurers are benefiting from cloud technology now, but executives expect artificial intelligence and blockchain to play a larger role within the next few years.
- To realize the full value of their technology investments, insurers must overcome hurdles related to the lack of IT collaboration and burden of legacy systems.
90% of insurance executives state they have a coherent, long-term plan for technology innovation in place.
“The operational efficiencies you can capture by applying technology to the middle and back office are a huge, real-time measurable benefit.”
Artificial intelligence, blockchain and the future of insurance
While cloud is having the biggest impact on business now, insurers see artificial intelligence and blockchain playing major and evolving roles in the future. As a relationship business, insurance can surely benefit from figuring out how artificial intelligence and machine learning can enhance customer service and the customer experience.
Insurers also see themselves investing significantly in customer-facing blockchain and internal blockchain applications within the next three years, with nearly half of respondents saying they will invest in internal blockchain in the near future.
The hurdles of legacy systems and IT siloes
To realize the full value of their technology investments, insurance companies must overcome the obstacles to growth presented by incompatible legacy technology. Forty-seven percent of survey respondents also say lack of collaboration with the IT function is preventing them from realizing their technology investments’ value.
Another important hurdle to address is related to the workforce. Ninety percent of insurers expect digital innovation to cause a significant headcount reduction. These concerns also stand in the way of digital transformation across financial services, yet four in 10 insurers expect their technology investments to improve employee retention and satisfaction, reducing turnover.