New Research Report Identifies New Spending Trends and Widening Gap Between Leaders and Laggards
Boston, Massachusetts, January 15, 2015 – Strategy Meets Action (SMA), a leading insurance strategic advisory firm, has just released a new research report, 2015 Strategic Investments: Making sense of the shifts. This report reveals that the leading insurers are reaching the next level of maturity regarding strategic initiatives, with investments beyond core systems aimed at winning in the increasingly digital world.
"The significance of this shift in investments is astounding. SMA has been tracking these types of investments for six years, and it's the first time that customer oriented initiatives like customer engagement, customer experience, and channel expansion have ranked higher than core system initiatives. This clearly tells us that companies are striving to become 'digital insurers' and that modernization of core business and platforms are maturing," said Deb Smallwood, SMA Founder and co-author of the report.
The report identifies the top strategic initiatives and highlights key takeaways and predictions for 2015 and beyond.
Key observations include:
- The bifurcation between insurers that are struggling and those that are growing and transforming will continue to grow. Today 11% of insurers define their company mode as struggling, up from 4% in 2014. SMA predicts that by 2018, over 20% of insurers will be struggling.
- Investments will continue in core system modernization, but as insurers complete their modernization, the shift in type and amount of spending will accelerate to strategic initiatives that will power the journey toward becoming a Next-Gen Insurer with digital insurer capabilities.
- Over the next three years, SMA predicts that over 65% of insurers in North America will embrace innovation, including the implementation of emerging technologies and the expanded use of collaboration with participants outside insurance.
Monique Hesseling, SMA Partner and co-author of the report adds, "These changes are leading many insurers to the inevitable conclusion that becoming a digital insurer is a mandatory and necessary business imperative. Strategic investments in the customer experience, analytics, and new products and services are paving the way for future success."
The purpose of this research report is to assist insurers and solution providers in identifying the shifts and understanding their implications, and then to provide a framework from which to evaluate their companies' strategies in the context of the marketplace trends. The report covers P&C and L&A insurers in North America, and it is based on SMA’s analysis of trends from our annual Insurance Ecosystem/IT Spending surveys over the past six years, in addition to our analysts’ observations. Contact Deb Smallwood at dsmallwood@strategymeetsaction.com or 603.770.9090.
