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By · March 25, 2022
6 minute read

Insurance Innovators Nordics: The future of insurance

FintechOS at Insurance Innovations Nordics

FintechOS will be at Insurance Innovators Nordics on the 30th-31st March in Copenhagen.  Find us at the Leaders’ Forum, where you can listen to our CEO, Teo Blidarus, share his thoughts on insurance innovation. In the meantime, read what Chris Kay, our sales director for general insurance, has to say about the future of insurance.


“[Digital products] offer added value to insurance customers beyond the traditional cover that they’ve lost faith in. These features will bring consumers back to premium insurance brands.”  

The insurance industry needs to change.  

Innovative technology that revolutionizes the way we acquire, manage, and claim from insurance isn’t just a future dream like a jetpack or a flying car. It’s being employed now and insurtechs are building an empire on the back of disruptive digital products. 

Chris Kay

Meanwhile, established insurers are working to catch up. The technology is there, but it’s much easier to get it working with a brand-new core infrastructure than to implement it in an environment made up of legacy systems from different eras that may never have been designed for digital integration. 

We know you’re aware of this. Digital transformation is a key goal of every established insurer, but it’s far from easy. According to a BCG survey, 70% of companies failed at digital transformation in the last year and received almost no return on their investment. 

The technology, however, is only the beginning of the story. A far greater challenge is the momentum of culture. Too often, we do things just because we’ve always done them that way, not because it’s best for our customers or our business. 

Large corporate structures moving at a glacial pace is the old way, while small, lean insurtech challengers are able to bend and adapt to the needs of consumers as they arise. Co-incidentally, this also better prepared them for the unprecedented changes to society over the last couple of years. 

There’s a real danger that larger insurers are going to fall behind their tech-savvy contemporaries and lose consumer interest. Customer experiences for established insurers need to start looking more like Lemonade and that needs to happen about two years ago. 

Meanwhile, clever players are identifying new, digital gaps in the market. Small-to-medium businesses, SMBs or SMEs, now take up 60% of the property and casualty market and UK law now insists accounts must be stored digitally for taxation. London firm Nimbla are taking advantage of this by offering cover based on data mined from digital invoices. 

Lemonade and Nimbla may still be a small fish in a big ocean, but they’re setting customer and SMB expectations. Soon customers will start turning to big insurers and asking why they don’t have an AI mobile app interface, tailored products, and innovative solutions that save them money. When that happens, you will need the latest technology to meet their expectations. 

Of course, I would say that. I’m here trying to sell you an innovative digital insurance platform that lets you take advantage of brand-new insurtech tools without replacing your legacy systems. Yet, in the first part of this series, I want to tell you that things aren’t as bleak as they may seem.  

A bleak, but hopeful, future 

It’s easy to look at Lemonade’s user interface and AI tools and feel threatened, but established insurers have the momentum and funds to outlast most of the innovative challengers taking up some of their space in the market.  

This isn’t the apocalypse for insurance incumbents, but that doesn’t mean they can ignore the insurtechs. Imagine what a large, established insurance behemoth could do if they had Lemonade’s digital interface and branding. These kind of digital, relatable customer experiences could go some way to winning back customer trust. 

Geneva Association data shows that only 21% of customers consider insurers to be trustworthy. 21% – that’s not a good position to be in. 

The pervading misconception for customers seems to be that insurers will do whatever they can to avoid paying out on valid claims. 68% of uninsured and 55% of insured consumers believe this, despite 95% of claims being paid out as intended. Yet, of course, unless customers make a claim, insurers have no opportunity to prove the value of insurance. 

Think of it from the customer’s point of view: if you don’t believe your insurance company will pay out on a valid claim, then why would you ever have insurance? 

Of course, you are legally required to have a certain level of cover in many instances, but even in those cases if a consumer doesn’t believe that their cover will pay out on claims, then they will just choose the lowest-level, lowest-priced cover available.  

A race to the bottom 

This leaves insurers facing a race to the bottom. The least-effective cover allowed by law will also be the cheapest and there will be no value added by any kind of premium service.  

Meanwhile, insurtech challengers like Lemonade are offering digital onboarding from a mobile device in 90 seconds, Vitality are offering premium reductions through wearable fitness trackers, and Ageas are using Tractable technology to do AI motor damage assessments from just a photo. 

In the future, there’s potential for innovative insurers to offer airport lounge places and hotel rooms to travel insurance customers stranded at the airport, automated breakdown cover direct to the GPS co-ordinates of auto-insurance customers, and automated drones to take photos of accidents as they happen. 

All of this serves to offer added value to insurance customers beyond the traditional cover that they’ve lost faith in. These features will bring consumers back to premium insurance brands, where you will have the chance to prove the value of simple cover when customers need to claim. The proof of the pudding is in the eating. 

These, however, are just small steps compared to three areas that are set to revolutionize the insurance industry. Firstly, insurance is set to go both bigger than ever, and also much smaller, before fading completely into the background. 

In the next part of this two-part blog series, I’m going to look at these three new kinds of insurance and how they’re shaping the future of our industry. 

Read more about parametric insurance, micro-insurance and ambient insurance in our next article:  Insurance Innovators Nordics: Three new kinds of insurance.  

And to find out more about the FintechOS platform for insurance, book a demo.


Chris Kay is the Sales Director for General Insurance at FintechOS.

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