Potential disruption of the insurance industry Presenting to Panel of Judges Presented by Lukas Grote Ina Jonalik Johann Wiebold Lina Zaika 182019 HHU Incremental innovations give potential room for disruption ID: 770096
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Potential disruption of the insurance industry Presenting to:Panel of Judges Presented by:Lukas GroteIna JonalikJohann WieboldLina Zaika 1/8/2019 HHU
Incremental innovations give potential room for disruption 1/8/2019 HHU2PerformanceTime high middle low Disruption theory by Christensen (1997)
Agenda 01 Industry assessment02 Roots of disruption03 Industry reaction04 Strategic alternatives1/8/2019HHU3
Disruption developed to an overarching megatrend 1/8/2019 HHU4IndustryUnderlying trendCurrent stateExampleAsset Management Artificial Intelligence Early BlackRock Robo Advisor Energy Climate change Developed Coal exit in Germany Entertainment Cloud technology Developed Netflix Health Biotech Early Siemens Healthineers Hospitality Peer-to-Peer Developing Airbnb Mobility Autonomous driving Developing Google car Insurance Blockchain Early Teambrella Retail Online marketplaces Developed Amazon
The focus will lay on the industries which have the highest potential to react successfully 1/8/2019 HHU5IndustryUnderlying trendCurrent stateExampleAsset Management Artificial Intelligence Early BlackRock Robo Advisor Energy Climate change Developed Coal exit in Germany Entertainment Cloud technology Developed Netflix Health Biotech Early Siemens Healthineers Hospitality Peer-to-Peer Developing Airbnb Mobility Autonomous driving Developing Google car Insurance Blockchain Early Teambrella Retail Online marketplaces Developed Amazon Potential State of disruption Disruptor power
Many potentially disrupting trends are coming up in the insurance industry 1/8/2019 HHU6IndustryUnderlying trendCurrent stateExampleAsset Management Artificial Intelligence Early BlackRock Robo Advisor Energy Climate change Developed Coal exit in Germany Entertainment Cloud technology Developed Netflix Health Biotech Early Siemens Healthineers Hospitality Peer-to-Peer Developing Airbnb Mobility Autonomous driving Developing Google car Insurance Technology Early Teambrella (Blockchain) Retail Online marketplaces Developed Amazon Potential State of disruption Disruptor power
Factors at the root of potential disruption 1/8/2019 HHU7New technologiesDigital insurerInflexible corporates Underpenetrated markets Automation Standardized products
Disruption in the insurance industry 1/8/2019 HHU8Performancetime high middle low
Current costumer journey 1/8/2019 HHU9 $0
Blockchain-based P2P insurance costumer journey 1/8/2019 HHU10 $300
Insurances have reacted to the disrupting trends rather slowly 1/8/2019 HHU11Applied technological trends in insurance industryExampleBlockchain AI Internet of Things B3i (blockchain insurance industry initiative) Different use cases e.g. Axa flight insurance Automated claim management Smart products
Traditional insurance companies could be cut out of the industry 1/8/2019 HHU12Only incremental innovation New business models need to be taken into account
How could insurance companies react differently? 1/8/2019 HHU13Buy start-upsBusiness as usualShift costumer focus Build up own resources Run Accelerator & Incubator programs Use knowledge to build up new revenue stream right away Continue insurance business without changes and serve remaining customers Focus on customer groups that are less likely to adapt Peer-to-Peer (e.g. business clients) Set up own portal for Peer-to-Peer organically insurances and monetarize it Support start-ups, share knowledge to develop together and set base to act when the business is mature
Different strategies have their pros and cons 1/8/2019 HHU14Buy start-upsBusiness as usualShift costumer focus Build up own resources Run Accelerator & Incubator programs + immediate integration of know-how Concept won’t succeed High investment risk + no additional costs High risk of disruption Loss of customers + more robustness to disruption Loss of private customers Lost potential + more influence Hard to build to internally costly Time intensive + low risk + flexibility + close to new trends + mitigate risk of cannibalization Difficulty to integrate
Different strategies have their pros and cons 1/8/2019 HHU15Buy start-upsBusiness as usualShift costumer focus Build up own resources Run Accelerator & Incubator programs + immediate integration of know-how Concept won’t succeed High investment risk + no additional costs High risk of disruption Loss of customers + more robustness to disruption Loss of private customers Lost potential + more influence Hard to build to internally costly Time intensive + low risk + flexibility + close to new trends + mitigate risk of cannibalization Difficulty to integrate
1/8/2019 HHU 16Insurance industry is facing potential disruption – Act now!
Risks and mitigation 1/8/2019 HHU17 Probability Impact I. Regulations might hinder the future business model II. Development of blockchain technology might not be as promising as expected I. II.