Beware the industry disruptors, warns the CEO of a European claims firm, who says that insurtech firm Lemonade is headed for our shores – and probably your market.
US-based Lemonade, which offers homeowners’ and renters’ insurance powered by automation, is leading the pack when it comes to digital disruption, according to Cees Werff, president and CEO of Claims Corporation Network.
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Crucially, Lemonade has tapped into one of the key drivers in the insurance industry’s need for change: evolving customer expectations. Describing the firm as “rapidly-expanding” and “digitally innovative,” Werff said that once Lemonade has finished rolling its product out across the US, it will expand into Europe.
“[Lemonade] will be in our markets quicker than we expect, and once they have the volume and the size, they will be able to come into your market and take over your customers very quickly, because they are adapting to the needs of the [millennial] generation,” he said at the Uniglobal annual claims management conference.
Changes spurred on by digital innovation and new technologies have already made waves in other industries, even edging out some players who thought they were too big to fail, the CEO said, and insurance is inevitably next.
“Digital innovation is all around us. Almost all other industries have already been majorly disrupted, except us. But it’s coming, and it’s coming very fast.”
A significant proportion of the insurance industry has thus far believed that major change is not possible, relying on insurance’s complex nature and high requirements for entry as a barrier to disruptors.
But much of the disruption that has already occurred in other industries has been led by firms that need not even own assets, but rather have shaken up distribution – such as ride-hailing app Uber, or home-sharing platform Airbnb.
Beyond simply adapting to new technologies, Werff warned that listening to customer expectations is crucial for existing insurance players to survive.
“Digital natives don’t want to receive a claims form with 80 pages that you have to fill in with a blue pen… They want to have instant, mobile contact with their service provider. They are going to choose those service providers that are able to offer that, and if the carrier is not willing to change or cannot change due to legacy, they will go elsewhere,” the CEO said.