Technology is changing how people buy their insurance, and the industry is at risk of being left behind if it doesn’t adapt quickly to ‘disruption.’
“You want to be enabling new technologies, not discouraging them,” said Alister Campbell, CEO of The Guarantee Company of North America. “We’re struggling with tobogganing as a technology yet.”
As part of a CEO discussion panel, Campbell, Greg Somerville and Lambert Morvan discussed the challenges that are coming fast and furious at the insurance industry – including such usage-based insurance telematics, driverless cars and companies like Uber.
“If we keep looking at every disruption as being problematic, we’ll always be on the back foot,” said Somerville, the president and CEO at Aviva Canada.
“The technology will always evolve,” said Morvan, the COO at Northbridge Insurance, “it is the concept we need to embrace.”
Campbell shared a personal story of how his teenage son routinely changes the temperature in the family home through his smart phone, raising the temperature (through the Nest thermostat).
“That is how technology is changing,” said Campbell. “If we look at auto, soon there will be a GPS on every part of the car – because by then it will be as cheap as borscht – which means virtually no more theft; and with the early warning systems to keep you from driving into the back of the car ahead of you – not to mention driverless car technology – soon there will be no more collision.
“At that point, quite a bit of our industry will be different,” continued Campbell. “We need to be ahead of the curve.”
That learning curve may be coming sooner than most think, cautioned one former CEO George Cooke, who spoke after the CEO roundtable.
“Look at the driverless car, it is terribly real,” Cooke, the president of Martello Associates Consulting, told the audience. “It won’t be immediate, but there will be a transition in the next 10 years, and there will be some interesting challenges to the insurance industry.” (continued.)
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The speed of change and the risk of becoming obsolete should be taken seriously by the insurance industry, warned Cooke, citing the examples of the demise of Blockbuster and the rise of Netflix.
“There are two things I can guarantee you: the transition will not be smooth, and there will be a transition,” he said. “The competition of the future for brokers isn’t here today, and it isn’t on the guest list here. It may be Google, or whatever comes after that – but there will be a substantive change to how car insurance is sold.”
