Round up of Making Innovation Happen – London

On Wednesday the 24th Celent hosted our event Making Innovation Happen in Insurance : Hedging Against the Future. The aim of the event was to move beyond the call to action, beyond the cries that innovation is necessary to discuss some practical ways insurers could innovate or have innovated. The feedback suggests we were able to do just that.

Jamie Macgregor welcomed our guests and introduced the day, swiftly followed by Mike Fitzgerald setting out Celent’s view on how innovation is not a dark art, but something that insurers can cultivate.

We moved on to hear from folks outside of the industry with Komal Joshi of Planned Departures talking about how they had used different types of partnerships to in their organisation. Paul Batterham and Rupert Tebb were then kind (brave?) enough to take the audience from the insurance industry through an exercise thinking differently about how to deliver a product for a specific group. I’m an optimist but I’ll have to admit some skepticism about how engaged our audience would be but the discussion kicked off so quickly they didn’t wait for the end of the instructions!

After a break Catherine Stagg-Macey and Lori Shook took the audience through how neuro-science and the limbic system drives responses even in corporate, unemotional environments. The audience interaction continued with an exercise that demonstrated our sense of fair play and revenge.

I pitched in with a view of prioritisation and metrics that hopefully gave some tools for thinking differently about the tasks at hand and which ideas should be really getting your attention (I’d love to hear if anyone managed to apply them when they got back to work yesterday).

Finally, Oliver Werneyer kept the audience captivated with his story of preparing a 150 year old organisation for innovation and the importance of having a beard when engaging with startups and in hackathons (at least I think that was the key message).

Perhaps our illustrator caught the message better:

Our illustrators view of the discussion in London regarding Innovation and making it happen. (Get in touch for the full resolution version)

All in all it was perhaps an odd mix of ingredients for a Wednesday morning but the result was well received with different participants, as the audience became, getting different things from each of the sessions.

This was something of a shake up of style from our usual events, a little test and learn from us and one that needed a lot of interaction. I’m glad to say our experiment worked.

For the live twitter discussion feel free to review the #celentinnovate Tweets.

If you missed it and want more details do get in touch!

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Analytics continues be show importance in insurance

As I am sure all our readers know, data analytics is a critical area for insurers. Few industries have as much data, and do as little with that data, as the insurance industry.

This was reinforced today when EXL Services announced their acquisition of RPM Direct, an analytics company focused on insurance.

Personally I find the use of analytics fascinating and see it every day when I get phone calls and emails that are clearly targeted at me. Sometimes it reaches the level of creepy — like the targeted ads on Facebook after I search for something on Google. Those searches follow me around for months. Good thing my searches are pretty innocuous. I do suspect I confuse their algorithms, as I am both a member of AARP and the father of four children under the age of five.

I would love to see insurers do more, but suspect they’re caught in the age old trap of ‘who owns the customer’. Most insurers with which I work still abide by the philosophy that the agent owns the customer.

My usual reaction is “STOP THAT”. Yes, that bluntly. Our world is changing and consumers want convenience and ease of access. The idea that a first time Life insurance buyer, say age 30, would ask an agent to come to their house actually makes me laugh. They’ll buy on their tablet and their phone. It’s time for insurers to step up and understand that.

Once they do, the power of data analytics and data mining will be huge. Think of the data — beneficiary data, life event data, so much about their customers and their customer’s families — all going to waste.

I keep saying that a company that doesn’t have baggage will come into our market and change things. The heart of that change will be phone/tablet/web sales backed with analytics.

Is that Google, Facebook or my favorite prediction Amazon? I don’t know, but it sure will be disruptive.

Good for EXL Services for catching the wave early.

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Are wearables truly this big? (The Apple Bounce)

An interesting research paper was pointed out to me by a colleague today. Entitled Wearables Device Market Forecast, from Tractica (follow the link to learn more), the summary projects a growth from 17 million in 2013 to 187 million units in 2015.

I am not doubting their research (and I admit, I only have access to the summary), as projections are based on many factors.

I just don’t believe it. Only 720,000 Androidwear watches were sold in 2014. They have glaring weaknesses, but some are not too bad (full disclosure: I wear an LG G Watch R). I guess the key question is whether the Apple brand can really drive an entire market — one that they did not invent.

Apple has been amazingly successful in so many markets. They revolutionized the market with the iPod, the iPhone and the iPad. Were they always first? No, a lot of products before. Were they always best? Again, no, superior devices have fallen.

But Apple is, well, Apple and their power is indefinable.

I just still can’t get my head around 187 million, particularly now that Apple has backed away from so many of the ‘really cool’ features (see my prior blog post).

OK, now that I have been a downer, I admit I want the market to explode. I like my watch, but don’t love it. I want it to be smaller, lighter and have better battery life. I want to market to continue to innovate and nothing does that like competition and volume.

I guess time will tell. I’ll make a note to look back in 2016 and see what actually happened.

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Major software vendor acquisition: TAI

There was a major upheaval in the vendor space with msg global and Logiq3 acquiring TAI. For those not in the know, TAI has been a major player in the Ceded Reinsurance space for a long time. Their impact on the market is hugely disproportionate to their small size.

This is a big deal for all their customers and those considering becoming their customer. They have investment behind them now, which should be good.

Of course, acquisitions come with disruption, as we have seen in the industry before, so we are hopeful this will transition smoothly and those involved will continue to be involved.

Something to watch for today.

Read the press release

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The security breach of the month, week, day…..and why you should consider the Cloud

I don’t want to pick on one particular company, but the breach at Anthem hits pretty close to home — our industry is under attack.

Should this surprise you? Absolutely not. What is particularly concerning is that these are companies that are spending enormous sums of money to stop these intrusions.

And are still getting hacked.

JPMorgan Chase, Home Depot, Target, Michaels.

I list these, not just as a reminder, but because I personally was affected by all four breaches. I’m on my third credit card in just over a year because every breach forces a new one.

The JPMorgan Chase and the Anthem breaches are different and more onerous.

In the Target breach, and others like it, credit cards were compromised. You can close a credit card account.

In the recently disclosed Anthem breach — everything was lost. Name, Address, Social Security number, employer, net worth.

In other words, everything to steal your identity.

I can’t close my life and open a new one.

Is there a purpose to this rant?

There is.

First, the technology exists — and is reasonably affordable — to encrypt this data. Is it a big project? Of course. Do you still want me to be your customer?

How is it that in 2015 critical data about me is sitting in a data center and not encrypted?

Second, one of the biggest arguments against using applications in the Cloud is that having data in your own data center is more secure.

Really? Seems not.

I was recently discussing running a Life insurance system in the cloud with the CIO of a larger insurer. They put forth the ‘safer in my shop argument’, so I asked them a simple question.

Is your budget for security larger than Google, Amazon or Microsoft (three of the largest Cloud vendors)?

After much thought, he replied that it was not, and our discussion changed paths.

So maybe it is time to rethink the importance of your own data center. Beyond just security, is it your core competency to run a data center? Does it bring new revenue into your company to run a data center? Is it cheaper to run your own data center?

I believe the answer to all three is a resounding No.

So when you are out looking for new applications and technology, I suggest it may be time, or beyond time, to think differently.

Oh, and start asking your personal bank, credit union, insurance company and more: “is my data encrypted?”.

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