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Welcome to March! The year is off to a quick start and, as we race toward the end of Q1-23, insurers are seeing an array of both challenges and opportunities emerge which will have a material impact on how they allocate resources and look to create competitive advantage in the marketplace. The post pandemic era has placed us in a period of rapidly changing consumer preferences, shifting demographics, and accelerated technology evolution. It is an interesting time, indeed.
One of the great challenges facing CIOs and their organizations now is turning data into actionable information which can be used to support decision making and execution. Ironically, we live in an era when we can be overwhelmed by the sheer amount of data available, sources of potential conflicting insight, and a need to be able to quickly facilitate decision making. The development of appropriate analytical frameworks becomes increasingly important as the pace of business accelerates, in part based on the expanded capabilities of rapidly advancing technologies. A potentially virtuous cycle if ever there was one. That raises the importance of having good and effective ways to filter out noise and get to the essential insights which can influence appropriate decisions and resource allocation. Some examples of the challenge have recently emerged:
- An article in the NY Times reviewed some of the claims made for autonomous vehicles, including the assertion that they are safer than cars driven by humans. Data suggest that this is true overall. The challenge with this, however, is that autonomous vehicles log almost all their miles on highways rather than the more complex environments such as urban settings. When normalized so that ONLY highway miles are reflected, the safety results are roughly the same. So autonomous vehicles are both safer than, and no safer than, vehicles driven by humans… at the same time.
- One of the interesting cloud computing assertions is that it is cheaper than alternative platforms for processing insurance carrier workloads. The implied savings are part of many business cases for technology migrations. The reality is that cloud computing is less costly for carrying workloads on systems optimized to leverage the unique nature of the environment. Simply lifting and shifting workloads from other environments, however, can cause costs to skyrocket, as carriers we’ve worked with have learned, much to their chagrin. As our research has shown, cloud computing is both less expensive than, and more expensive than, other alternatives… at the same time.
- Recent LIMRA research highlights the desire for consumers to engage agents when navigating the value proposition for complex insurance products designed to address complicated life needs. Does this mean that agents must perform their valued role in person, or is technology enabled virtualized engagement what consumers have in mind? It turns out that both may actually be true concurrently, separated by different preferences by generational cohort.
The point is that for insurance carriers, faced with a myriad of competing demands for finite resources, having the discipline to dig deeper than just the headlines on an issue will be critically important to making the right decisions, at the right time, to be able to nimbly move into the future. Understanding the context of questions when raised and having the analytical rigor to explore the underlying data to ferret out the appropriate insights, may well be the difference in achieving the kinds of success that produce sustainable competitive advantage. Armed with this insight, let’s roll. The year is already moving quickly!