The Insurance industry has been warned that it is in danger of becoming irrelevant if it does not grasp the need to innovate.
The report from Chartered Insurance Institute’s New Generation London Market Group to the institute’s board warned that the events of recent years have changed the risks the market is being asked to assume and that unless insurers change and innovate, they will be left behind.
It went as far as to conclude if the insurance profession does not learn lessons from the pandemic and innovate it could soon no longer meet the public’s needs.
Each year the CII gathers 40 young professionals from claims, underwriting, broking and the London Market and sets them the challenge of identifying and completing a project or initiative they believe could make a difference to the insurance profession.
Those in the group are regarded the rising stars of the profession and their report has prompted an immediate response from the CII.
“A combination of weak innovative culture, fear of failure and a predominant focus of improving current ways of working, will limit the profession’s ability to address needs,” added Matthew Connell, director of policy and public affairs at the Chartered Insurance Institute. “This report from the CII’s New Generation Group shows the value of engaging with fresh entrants to the profession and encouraging them to challenge our processes.”
The report has called on senior insurance leaders to improve the profession’s innovation culture having identified three core issues that the industry has to address if it is to thrive in a future where emerging risks will test its relevance.
The group said the first step was to examine the insurers’ internal operations and strategies. Companies needed to urgently identify their own organisation’s barriers to innovation and take relevant steps to address these issues.
They also need to effectively communicate an understanding of innovation that shifts the focus from improving current operations to addressing changing needs. Finally the industry, its leaders and its companies have to better promote how innovation is achieved more effectively.
“Professions that fail to innovate at best plateau. In this digital age, we all must understand what engages and empowers consumers to take action to mitigate the risks they face through insurance products if we are to remain a modern, relevant and able to meet the diverse needs of the public,” added Connell.