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Amazon might not be selling insurance yet, but the ‘Amazon experience’ is influencing consumers’ buying habits across all products and services, and insurance companies can either innovate or lag behind.
“Every company we work with in the P&C industry is trying to step up to that bar because not only do consumers expect that, in companies that we work with the employees within the insurance company expect that,” said Alex Naddaff, chief cloud officer at Guidewire Software.
When shoppers go on Amazon, the platform provides suggestions for products they could be interested in, and then sells that product and works to deliver it promptly to their door. From his own experiences using the website, Naddaff says that he expects every vendor he works with to interact with him on the same level as Amazon, as do many consumers.
Introducing the cloud into their business processes can help P&C insurers serve their customers effectively as not only their expectations change, but the risk landscape shifts as well with the constant barrage of natural catastrophe and cyber threats. On top of that, the pressure to innovate is ever-present across the insurance industry – most brokerages already have management systems in place and others are starting to figure out the how to integrate mobile apps and self-service portals into their businesses – and carriers aren’t exempt from the innovation rat race.
“There’s a need to innovate quickly – everything is happening very fast today, the industry is changing, the challenges they face are changing – and so they’re trying to adapt to those changes and they have to introduce change quickly,” said Naddaff, adding that the cloud can help insurers evolve at a faster pace, especially as new regulations introduce strict standards, such as the right to be forgotten under GDPR. “That capability doesn’t exist in many legacy systems and in fact, it didn’t exist in our systems until we made the investments to make it happen.”
Cyber is another concern that’s a frequent topic of discussion among the insurance industry as well as their clients, and for companies that hold a lot of customer data, like brokerages and carriers, the need to keep that information secure can be met by using a cloud platform since the burden of security is handed off to professionals with significant cybersecurity experience. The insurance company then has the confidence to explore other technology-related adventures, said Naddaff, and know their customers’ data and their own environments are safe.
“Historically, companies worried that security was a concern in the public cloud,” said Naddaff. “We’re at a point now where just about everybody’s convinced that a company like AWS [Amazon Web Services] or a company like Microsoft can provide equal or better security with most of us understanding that they have better capability than any one company can have by itself.”
