Digitalisation in shipping and logistics was the topic of my last message. We looked at the considerable progress the industry is making and the need for insurance solutions to meet its dynamically changing needs. Digitalisation will massively alter the business of our clients – and radically reshape the insurance business model as well.
Distribution – still dominated by brokers and insurance agents – will strike out in new directions through the use of internet-based placing and online price-comparison platforms or web-linked rating and pricing tools. Digital sales channels are becoming standard.
To realise the full potential of the digital age, we need to understand that the customer journey is key. We must proactively shape it to meet the expectations of the new generation purchasing marine insurance on behalf of our clients. These “Millennials” are digital natives, who have never known a world without computers and the internet. This demographic has changing purchasing habits, expecting goods and services to be accessible at all times. We should look for ways to offer convenient and automated purchase options for commercial insurance, available on a 24/7 basis. We can also use digital technologies to shorten response times and then create customised products and solutions based on personal consulting.
Above all, we need to utilise today’s connectivity to generate more customer touchpoints, points of entry for personal contact, service and individual consulting.
Digitalisation will also revolutionise our internal processes, shortening the insurance value chain. Artificial intelligence (AI) will play a particularly important role in supporting automation. Consider, for example, the efficiency potential of digital accounting, computerised underwriting for less complex business and automated claims handling.
As Industry 4.0 and the Internet of Things (IoT) become widespread, insurers will have access to unprecedented volumes of risk-relevant data. By improving data analytics, artificial intelligence and machine learning, we can turn the raw data into invaluable knowledge. This will enable us to introduce pre-emptive risk-mitigation measures, reducing the claims burden and allowing us to improve the quality and accuracy of our pricing.
Ultimately, we need to ask ourselves what future role we as marine insurers want to play – pure risk carriers or trusted partners offering comprehensive support and services to manage risks in a changing world? I would venture that the future belongs to those players who take up the challenge and embrace the latter role.
Fortunately, the marine insurance community is well equipped to advance to this new position. Based on decades of experience in working closely with clients to handle complex and evolving risks, marine insurers are in close touch with the needs of shipping and logistics companies. By drawing on this knowledge and building on the trust our industry has earned, we can create digitalised and personalised customer journeys that meet or exceed future expectations.
The task ahead is to embrace digitalisation in our thinking and business models, make the required investments and empower staff members with a digital-age mindset. I look forward to seeing marine insurance step up to the next level.