In 2016, Digital, Analytics, and Mother Earth will not be Ignored

There’s a lot going on, and when the present is so busy it’s hard to look long-term. That said, I believe there are three trends we will not be able to ignore in 2016: Digital, Analytics, and Mother Earth.

I want to share my thoughts with you in print now, and in person later.

Digital

Back in July, citing Bain & Company, I suggested that, while insurers were aware of digital pressures and opportunities, most insurers were unsure of where to start and how to proceed.

My best guess at the time was that we would continue to muddle through.

I now think that the days for muddling are over. This year saw several large companies ( including Aviva, Intact, Manulife) open digital innovation centres in Canada.

We also saw some very innovative implementation of digital by brokers and smaller insurers  (e.g., Gore Mutual with uBiz, Sharp Insurance with consumer apps, Bullfrog with integrated commercial lines quoting and issuance.

These will set standards that consumers (in all demographic segments) will learn to love. There will be significant competitive pressures.

The organizations that will be especially challenged are mid-sized insurers which are midway through core systems projects and have other IT projects on the go. Finding capacity will be non-trivial, but necessary.

Analytics and Intelligent Machines

Digital systems make up the arterial system. Intelligent machines and Analytics and Data comprise the brain and neural network.

This is not new to insurers. We have lived and died by data since Lloyd put up chalkboards.

So, what’s new? The content (numbers, words, audio, video),  function (prescriptive, not just predictive and descriptive), processing capabilities (adaptive, not just delivery), and speed (real time or sooner).

And, most importantly, utilization of analytics will impact the whole organization, its customers, and partners.

Disruption will come from organizations which may or may not have an insurance background. What it will have have is a strong, but flexible analytics structure which is targeted at customers.

In November, I wrote about a physician who was hungry to learn about peer-to-peer insurance. Having gone through my first Hackathon, I am convinced there are organizations who are hungry to learn about physicians who are interested in peer-to-peer insurance.

It’s a Mother of an Earth

On December 31, 2015, my smartphone told me the temperature would be 2 degrees Celsius for most of the day.  Winds were calm.

At the North Pole, the temperature on December 30th was a just a little cooler, -1.9 degrees Celsius. The North Pole. In winter.

Winds in Iceland were up to 112 km/hour.  This is not unusual for Iceland. “What is unusual, however,” the Weather Network said, “is the impact that this storm is expected to deliver to the Arctic.”

From an insurance standpoint, we may not be immediately worried about damage at the North Pole, but there’s more.

The Jet Stream hit speeds of 370 km/hour in the area. Passengers on an Air Canada flight from Shaghai to Toronto made an emergency landing in Alberta after, what the Calgary Herald said was a ‘flight from hell’ over Alaska.

What’s the insurable interest in a plane full of people?

Some disagree with the premise of global warming, but Intact recently announced funding for the Intact Centre on Climate Adaptation (ICCA), “an incubator for new adaptation measures to climate change.”

Intact’s CEO, Charles Bridamour, noted that with climate change occurring in Canada, “We must step up our efforts towards building strong, prosperous, resilient and sustainable communities.”

Climate change is a very big wild card.  Intact’s leadership, along with the yeoman’s work being done by the Institute for Catastrophic Loss Reduction (ICLR), is helping us understand the implications of climate change, and the causes. 

As an industry, we are providing leadership and should be prepared to continue.

As far as Insurance-Canada.ca goes ….

We are preparing for several events to help us all understand the impacts of these and other insurance-technology trends.

The 2016 Insurance-Canada.ca Technology Conference (#ICTC2016) and its new sister, the 2016 Insurance-Canada.ca Broker Forum (#ICBF2016) are occurring 29 February and 1 March 2016 in Toronto.

We have got great agendas, speakers, and sponsors.  All we need now is you!

We have also started work on the 2016 Insurance-Canada.ca Executive Forum as well. Stay tuned for dates and location.

Lastly:  All of us at Insurance-Canada.ca wish you the very best for 2016.