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The New Insurance Model - It's Not Business As Usual

The New Insurance Model - It's Not Business As Usual

Review of Larry Wilson’s Keynote at the FINEOS Claims Global Summit 2013

Steve Dorn, SVP Strategic Product Group, FINEOS

It’s the opening day of the FINEOS Claims Global Summit in Toronto, Canada and we are surrounded by many of the industry’s key executives from leading global insurance companies.   Kicking off the conference with his keynote address is industry icon, Larry Wilson.  As a point of reference, Larry has been involved in the industry from the early days of modern computing in insurance.  Larry founded the largest insurance software company in the world, PMSC, which was later acquired by CSC and has founded many other successful insurance technology startups such as Duck Creek, Dove Tail and Eagle Eye Analytics.  As a business builder and investor, Larry could arguably be labeled the E F Hutton of the insurance technology space.  When he talks, people listen.  What he discussed is an exciting and engaging industry picture of a new reshaped insurance model.  A model with changing customer personas, innovation, and disruptive technological change.  An industry that used to use new technology as a cool gadget, and now uses technology as a market driver, a market enabler.  He described an insurance market where all of these forces collide and create a perfect storm.  One that can crush companies, or one that creates unprecedented opportunity for companies breaking out of the business status quo.

Larry explained that we need to remember customers are at the center of the business, and that today’s customers have higher standards and expectations of their providers and what they define as great service.  This new customer demands options for self service, mobile, tablet, texting and has little patience for being stuck on hold having to repeat information to get help.  Another key point in Larry’s message, that resonated with the audience, was  that  future corporate value would be determined not by building technology but by progressive companies that are focused on how to apply technologies to create opportunity and better serve customers.   Larry identified some company examples of appliers of technology like Amazon, Google, LinkedIn, and Facebook where the application of technology reshaped how we do business.   He was also quick to point out that the Insurance industry as a whole has been slow to keep up with the pace of technological change.  When you think of topics like cloud, mobile, big data, individual connectivity and others, these are typically not paths being blazed by the insurance market and if we let market excuses like regulatory change, complexity and capital requirements create obstacles to innovation, we will never be in a position to capture the market opportunity in front of us all today.  Much like a personal trainer who challenges you to improve, Larry issued a challenge to the group to rethink everything that has made you successful and suspend your preconceived biases.  Open yourself up to thinking like entrepreneurs, like Steve Jobs and Mark Zuckerberg,  or risk being out-positioned by competitors or new companies because there is too much financial influence in the insurance market for it not to evolve and for someone to take the lead.  It was a real wake up call to the industry, reminiscent of automobile icon Lee Iacocca’s statement “Lead, follow or get out of the way”.  A very compelling keynote indeed.