Ignoring the sales pitch, an interesting article on innovation in the insurance market outlining some of the reasons why take up has been slow. Hopefully this will change through the work of the Innovation Council by showing everyone that it isn't as hard as they think!
The insurance industry has been ripe for disruption for years and yet nothing has changed in decades. Why is this? Every player in the insurance market has been enjoying 10-20% net margins for over a century, so why would they want that to change? Lloyd's tried bringing into their organisation technology innovation with Kinnect in 2002 but after £70m investment and 5 years, it was shut down. Hence, until the rise of fintech, insurance companies felt very comfortable with business ‘as usual’, since the Kinnect episode had made it very clear that no one was prepared to change how things were done. However, things have begun to change. Over the past few years, the sector has seen more innovative tech-led businesses. However, a great proportion are making the existing industry more efficient rather than disrupting the incumbents. Why is that?