While the market as a whole had already been facing disruption in its technological operations over the past few years, the pandemic only sped up this transformation process. Even the insurance industry, regarded as somewhat traditional, ushered in innovation into its strategies and has already welcomed a concept that promises to shake things up in 2022: Open Insurance.
Conceived to open up the market by sharing and circulating data of policyholders and pensions between companies, OPIN (Open Insurance) represents a major opportunity to integrate business ecosystems, promote digital partnerships and open up new contact channels with clients.
At the same time, the model also gives greater autonomy to consumers, who now have absolute control over their information and will certainly become even more demanding and analytical about what and from whom they buy.
What does that mean? Greater competition, and especially a massive need for resilience.
According to Gartner’s report on the insurance market trends for 2022, the four key factors for success are based on:
According to the global consulting firm, adopting a composable infrastrucure is one of the essential strategies for insurance firms and insurtechs looking to streamline the complexity of this journey and speed up innovation to succeed in the market.
Composability is nothing more than a module approach of corporate computing, which can be dynamically reconfigured. In other words, think of composable infrastructure as a Lego set, where each block represents a computing infrastructure. By assembling all of the blocks together, we can build a system of any size, shape or proportion.
All of these resources are based on a piece of software, through a web interface, ultimately representing greater availability for data centres and the cloud. Not to mention scalability, savings for the company and more free time for the IT area.
Also according to Gartner’s report on the insurance market trends for 2022, companies that adopted composable business are those with the highest likelihood of success in cutting operational costs, risk management and revenue gains.
Specifically in the insurance sector, however, it’s not just composability that is left aside, but also the use of digitalization of external processes and digital channels to generate income.
According to the report, only 8% of the CIOs of insurance companies stated their corporate strategies are already focused on the three pillars of the composition strategy: insights, business architecture and technology.
Click here to check out the complete and free 2022 CIO and Technology Executive Agenda: An Insurance Perspective – Gartner’s report on the Insurance market’s trends for 2022.
On to the good stuff!
In Open Insurance, companies share their policyholder data and other information on products and services through public APIs. With these open applications, insurtechs and major insurers can combine their expertise to create new solutions, offering something that would be impossible to achieve on their own.
This combination is paramount, since the demand shifts according to user behaviour, which has become more and more digital. Routines are changing and this is expected to carry on.
The number of workers using their own vehicles to and from work, for example, dropped thanks to remote working models. If a car insurance company is only able to offer that one product to customers, how will it stay afloat in a world treading towards remote or at least hybrid work models?
With Open Insurance, the market offers companies a new opportunity to reinvent themselves and boost sales with innovative offers. However, they must be able to take in this entire digital transformation.
Organisations with composable infrastructures will be able to keep up with this fast operational pace and urgent demands, helping them come up with new products and services on the spot. After all, composability allows companies to combine resources (as in the Lego set example mentioned earlier) dynamically, in order to meet exclusive needs.
Ultimately, a flexible company able to adapt to different scenarios will be more likely to succeed on an open journey.
Looking for more information on how to ensure success with Open Insurance? Click here to find out how Sensedia can help you and contact us right away for a free consultation.