Movers and Shakers: “What can be expected from the second half of 2019?”

Results are the main KPIs of the movers and shakers in modern economy. These results are largely determined by the accuracy of business forecasts. To forecast developments and adjust own strategies and actions are vital also in the insurance and finance industry. 

Therefore we are honored that over 20 decision makers and thought leaders in finance and insurance share their views and forecast for the rest of 2019 and beyond. 

Thank you all!

A big thanks to (in no particular order):

“I think the war for talents will be fought with even more creative ideas regarding employer branding. To observe this trend will be very exciting and interesting, it is, however, also very challenging for all companies.”

“I expect record breaking funding for the leading players & platforms in the FinTech ecosystem as it is rapidly growing and sustainable business models are evolving. Especially companies who master to reduce complexity & costs by utilizing data & AI will thrive. 

Also, foreign players will continue to capture Germany and Europe through cross-border initiatives. Current examples are insurance giant Ping An or FinTech unicorns like Lemonade.”

“We expect the market to stay as dynamic as it was in the first half. New players are entering the market and are driving healthy competition. We saw also some consolidations. And, as you know, things can change very quickly. A closed funding round, acquisition and mergers can change the status quo in a heartbeat.”

“Insurtech is entering the next phase: it’s about action, not discussion now. I therefore predict increased numbers of live insurtech products and services, and the significant growth of those products already in a strong position in the market. I also predict increased internationalisation as the best of insurtech breed repeat their success in other countries. I also see the strong theme of Trust having a major impact on the whole insurtech and insurance landscape, and believe the winners of customers’ trust will be the companies that take pole position in the future.”

“I see the trend towards more health-conscious living continue to grow: with the alarming increase of non-communicable diseases, more people are concerned with health and wellness topics and thousands of companies will continue to capitalise on this trend. We’ve been doing this for many years now. Therefore I wouldn’t be surprised to if new features in the device will be launched focusing on health like measuring blood pressure, glucose and cholesterol level. Furthermore first steps in buying insurance via smart speakers.”

“Second half of 2019 in Dubai we are seeing more Digital Marketing coming in to the agents business. Dubai is now a buyers market so predominantly 80% of all sales are offplan.”

“I expect further examples of new mobility and home value propositions beyond telematics and smart home to appear as many insurers are expanding their value propositions into these ecosystems.”

“With regard to the German life insurance market I see a positive business development trend for the second half of the year. Especially for those companies who have managed to rejuvenate and flexibilise their product and are thus meeting new consumer expectations.”

“The most important banking service in the future will be asset management. Complementary thereto the trend of sustainable investment and finance will continue. We have been a trend-setter in this area: For example Warburg Invest has initiated the first sustainable fund of funds in Germany back in 2004.”

“With the InsurTech movement now 4-5 years in where we have seen many InsurTech startups enter the market, we are now seeing traditional insurers lead by increasingly standing up separate businesses, launch and incubate new products, reach new or underserved markets and use platform technologies to innovate. The days of a single policy, billing or claims solution is coming to a rapid end. While necessary in a legacy on-premise world, single solutions are obsoleted in a new cloud platform world focused on minimal viable products (MVP), pay as you grow technology options and the need for “test and learn” environments that allow rapid launch and change.  These platforms enable insurers to be competitive, improve cost structures, create customer-focused solutions and, most importantly in today’s fast-paced world, address the need for speed.”

“A half-year probably isn’t enough time to see a new trend, so I will say that we should see continued maturity from the startups of two years ago. Beyond that though, I think there will begin to be pressure for these maturing companies to either grow faster OR show better financial results. There has been a lot of capital placed in this sector and at some point, investors will want to see returns. I think that happens in 2020.”

“Increased focus and value is placed on the customer lifetime value. The benefit of the value we are increasingly recognized. It is becoming increasingly important to evaluate the customer potential for the lifetime. The calculation of Customer Lifetime Value helps insurance companies, and especially startups from the financial and insurance industries, in this situation: Customer-specific profiles allow the estimation of customer value and justify investment in their long-term commitment. Inventory data is no longer sufficient to form such a profile. In most cases, external data resources must be used to enrich the data accordingly. This way, an exact customer evaluation is achieved by means of more precise profiles. Data is King! There are a few that make this very impressive.”

“I am starting to see pilots and proof of concepts moving into actual production which is exciting. I also hear startups taking more about “proof of value” instead of POCs to emphasize that their tech is proven as well as “initial implementations” for the cost of a pilot to provide lasting value and enabling production-ready capabilities from Day 1. I think we are beginning to learn “what works” in FinTech and InsurTech. I am also seeing that startups who are bootstrapping are falling behind those who are VC funded because they are struggling to achieve scale, which is critical at this juncture. As startups become more established and mainstream, it becomes harder for brand new startups and smaller firms to compete in an increasingly crowded marketplace.”

“Customers today have much more opportunities to interact with companies than they used to have and expect a modern and consistent customer experience across all channels. Therefore, in my opinion a well-positioned customer relationship management, big data, an efficiently used AI and the transformation of old IT systems will play a special role in the development of insurance companies.”

“We are convinced that we will see more development with respect of the connection between incumbents and new players in the market, no matter whether they are new full stack insurers or Insurtechs fulfilling one step in the value chain. Cooperation has been a theme of the last twelve months; we will see the fulfilment of this theme/vision in the coming 12 months.”

“While the first wave of innovation in insurance has come in the form of improved customer journeys and reduced question sets we expect to see more innovative solutions around better usage of data. AI and Machine Learning are just scratching the surface at the moment and their application within customer and insurance datasets will see the next big shake up of the industry.

With the growth in connected devices and IoT products, fundamentally, the exchange of data will bring value to the customer in the form of bespoke products, lower premiums and preventative coverage.”

“No – not Blockchain…got my doubts at the moment. We can see a lot of health developments in the digital labs which is quite interesting. My personal „hits“ for 2019/20 are the upcoming developments in the ai-based robochat area. This is highly interesting for insurers because it might really improve service quality and speed for customers. Specifically in service-areas which are by today still dominated by physical service staff (call center, first level etc.). As soon as the InsurTechs like or Botfriends have reached a sufficient level of language recognition in combination with AI it might become a mega-trend.”

We will see 5 trends: First, the wave of collaborative Insurtechs will pursue to grow in LatAm and principally in Brazil, Mexico, Argentina, Chile and Colombia. It exist a 2 or 3 years delay vs US and Europe. Second, Insurance Corporate Venture Capital will appear because local insurers are understanding that is a way to capture innovation. Third, new insurance incubators could appear because LatAm is a good place to innovate and to be entrepreneurs (ex : RUS in Argentina is developing an insurance incubator with 3 start-ups). Fourth, extraction of petroleum inside Insurance Call Center : NLP will capture customer needs since unstructured data. Fifth, Telematics and IoT in insurance will pursue to be a hot topic.

“With regard to Life & Health we will see further developments in the area of digital engagement and risk reduction. Valuable data is essential for life and health insurers. So wearable data will increasingly contribute to this need while simultaneously interacting with customers and rewarding them. Market players like have developed unique solutions for insurers to become a part of their customers’ daily life and to create added value to protection products. Overall, the change from being “the reimburser only” to becoming “a life companion for customers” will continue.”

“Go big or go specialist. In order to survive and prosper in the modern European market insurers are either dominating through size and influence, or are picking up niche markets by providing specialist product and excellent customer experience. I’m looking forward to how the market develops further!”

“I will be looking with interest at the next investments of SoftBank Group which have just recently put their money in Lemonade and Indian company Policybazaar. I believe India will be a hot bed of startups and that investments will continue to come in. Asia is very interesting at the moment but it’s also very vast and complex and that makes it difficult to predict who will emerge among the winners. I believe health insurance and mobility will be some of the main focus points of startups in this part of the world on the short term while green initiatives will become more and more part of the scenery on the long term.”

“Continuing on the thread of increased maturity: young companies are finding their niches and coming back to the market with real differentiation.  We are also seeing more entrepreneurs tackling commercial and specialty lines – which can be tougher but more profitable than mass market personal lines.  SCOR has announced partnerships with a couple of these companies, and we see more coming.”

“We see a growing trend towards 1:1 communication. Messaging services such as WhatsApp or Facebook Messenger have by far overtaken SMS usage and offer a wide range of additional options. Used correctly, banks and insurance businesses can now get closer to their customers than ever before. They can offer their services in a channel that has become an integral part of customers’ lives and is perceived as very personal, fast and simple.”

“New client engagement models with a shift towards convenient mobile banking for everything from making payments to loan applications, increasing migration to public cloud to accelerate digitization, and blockchain for better security and digital payment protection.”

“We expect even more partnerships between established and rather young players. It turned out to be a successful strategy to combine the reach of a big company with the fast and agile solutions insurtechs and fintechs can provide.”

“Continuing on the thread of increased maturity: young companies are finding their niches and coming back to the market with real differentiation.  We are also seeing more entrepreneurs tackling commercial and specialty lines – which can be tougher but more profitable than mass market personal lines.  SCOR has announced partnerships with a couple of these companies, and we see more coming.”

Thank you all for participating, sharing your insights – it’s great to be part of such a special insurance community. 

Dr. Robin Kiera

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