Canadian Underwriter

Where digital transformation goes wrong for the P&C industry

July 7, 2022   by Jason Contant

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Canada’s P&C insurance industry needs to get back to basics — unmet customer needs — when designing tech-enabled digital strategies and products, speakers said last week during an industry webinar.

Too often, carriers or other industry stakeholders get involved in an “iteration cycle,” said panel moderator Bryan Falchuk, founder and managing director of Insurance Evolution Partners. That’s when products are created to satisfy a regulatory requirement, loss situation, better combined ratio or another internal need rather than a consumer need.

“It’s so easy to lose sight of, ‘Did the customer even want this, or does this even speak to that [unmet] need?’” Falchuk said during the June 29 Reuters Events webinar, From Disruption to Revolution: The Tech-Enabled Digital Strategy to Ensure Success. “Ultimately, if it’s not something the customers care about, there’s no point to it and we’re not going to succeed.”

One panellist said it’s important to consider why insurers exist. “If we were starting a carrier from scratch, we would all be looking at product market fit,” said Hashmat Rohian, vice president and chief technology officer for emerging business models at The Co-operators.

However, as companies age, they develop infrastructure, technological, operational and social aspects, as well as legacy systems, and their focus can shift as a result. “As we build bigger balance sheets and we have recognized brands, the thinking moves from product market fit to product organization fit,” Rohian said.

Screenshot of Reuters Events' digital strategy conference

Clockwise from top left: Hashmat Rohian, vp and CTP – emerging business models at The Co-operators; Sam Passafiume, senior director & head of data & information at RBC Insurance; moderator Bryan Falchuk, founder and managing director of Insurance Evolution Partners; and Lisa Joy Trick, Westland’s service design lead, at the Reuters Events conference.

“How do we avoid that trap? How do we make sure that the questions we are asking [ourselves] as leaders in insurance are still focused on what is best for the customer?” Rohian asked. “What will keep us relevant and ahead of our competition, and always focused on that product market fit…?” Are we building a feature because it’s easiest for us or because it creates the most value for our customers?”

A product-market focus and a product-company focus are not mutually exclusive; organizations can be both, Rohian said. “But if we keep ourselves first, eventually we will find ourselves last,” he said. “That is one thing we really have to think about — why do we exist? And as we grow, we always have to go back to those basics — customer needs… unmet needs. Are we still relevant?”

Industry players can no longer think of business strategies and technology strategies as separate silos, Rohian said. “There’s a business strategy, and technology is infused.”

The digital transformation journey should be holistic, taking into account both the client’s perspective and the insurance provider’s internal capacities and people, said Lisa Joy Trick, Westland Insurance’s service design lead.

“How do we blend our brick-and-mortar experiences with our digital experiences to provide that kind of intended journey?” Trick asked. “Through service journey mapping, and through client research, we can learn more about which exact experiences are unique and special to our clients and not necessarily lose all of that — that brick-and-mortar experience that so many of our smaller brokerages that we’ve acquired have really built up and are important to our clients.”

Digital transformation is also about bringing “the right information to the right place at the right time,” said Sam Passafiume, senior director and head of data and information at RBC Insurance.

“The right place is no longer, or doesn’t necessarily mean, on our infrastructure on our platforms. It could be an API [Application Programming Interface] to an appropriate MGA [managing general agency],” Passafiume said. “It’s delivering that data to the place [where] the consumers, the users, want it to be. We’re always looking to make it easy; that frictionless kind of environment.”

The consumer’s best digital experience with a retailer is now what they expect from an insurer, Rohian said. “How does a company, a traditional carrier, still remain relevant and evolve from a linear pipeline business model to a more network platform-based business model? Those are some of the questions that have forced organizations to either accelerate or really rethink and reimagine a digital journey.”


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