The insurance market has increasingly encountered the need for speed when it comes to implementing change. The recent extension of the so called ‘dual pricing’ deadline is a case in point. The Financial Conduct Authority outlined the new timescales in their recent publication The implementation period for any rules arising from CP20/19. The article acknowledges that the new requirements will entail significant operational and business-wide changes for many. These include developing and testing new pricing models and re-coding IT systems. Even with this extension, many organisations still feel they will struggle to meet the deadline.
However, the need to respond to change is nothing new for the insurance market. There are many examples of insurers having to quickly implement change coming out of the current COVID-19 crisis. Undoubtedly the ability to change quickly is a huge benefit.
Why does change often happen so slowly?
Historically, the main challenges to making changes has been the lack of internal appetite and the right systems and processes.
Those at the top of any organisation must be the driver for change and this is not always the case. In addition some organisations are caught in the ‘legacy trap’. This means that the technology and organisational structures are not designed to support change within short deadlines.
The issues thrown up by the current pandemic have served as a warning. The insurance landscape has changed. People expect digital solutions from their Insurers as well as in the work-place. Add in the increasing number of regulatory challenges, the need for speed becomes self-evident.
How to meet the need for speed
In a nutshell, there are two main requirements for any organisation to react quickly to the need for change. Firstly, the right people supported by the process to design and implement solutions quickly and secondly the right technology.
The right organisational structure
Change starts from the top. It is only with the right leadership that change can happen at the right pace and in the right way for your business to prosper.
Leadership does need the right organisation structure for change to happen quickly and efficiently. If the Organisational structure is focussed on the holistic needs of the customer, product silos can be broken down. This means change can often be rolled out seamlessly across the business, instead of separately in each individual business unit. Sounds logical, but certainly not straightforward to deliver.
The right technology
Barriers to change often include legacy or slow technology. But technology should never constrain business innovations, it should enhance them.
The right technology can offer:
- The flexibility to develop and change your products and processes quickly and easily.
- Solutions that enable you to provide multi-channel communication and fulfilment (by phone, face-to-face, on-line, email…)
- The ability to deliver the creative aspirations of your company.
Technology is an enabler that should be in place to support the right people and organisational structure. In a previous blog we explored the question of To build or buy insurance tech? Now is the time to answer that question if the current need for speed has highlighted gaps in your technology capability.
In a nutshell, the need to change has become a new normal for the insurance market. Those that can deliver change quickly will undoubtedly have an advantage. A recent white paper from PWC, Beyond COVID-19, identifies five key strategic priorities for a post-crisis world. Each of them involves either organisation or technology.
Content has been prepared exclusively for Total Systems plc, a specialist provider of insurance systems developed for the digital insurance age.