Insurance companies face conflicting challenges. They must contend with continuing instability in financial markets, low interest rates, increasing acquisition costs, changing regulation and catastrophic losses from ongoing natural disasters. But the toughest challenge faced by the insurance sector is the one that is transforming consumer behaviour and business models - digital technology.
Digital is a new market force that is driving massive change in consumer expectations. It will require a different set of skills, culture and measurement. Industries such as telecommunications, consumer products, and media and entertainment have already harnessed digital to attract and retain new customers. It is time for insurers to evolve and respond: they cannot afford to be on the sidelines of the shift to digital.
In light of this imperative, EY undertook a ground-breaking survey of more than 100 industry players to understand how the digital agenda is reshaping the sector and to what extent life and non-life insurance companies are grasping and exploiting the shift to digital. To complement these insights, this report outlines examples of digital innovation and suggests practical areas that insurers should prioritise now to tackle the challenges ahead.