Insurance Platform

Groupama and IBM find opportunity through disruption

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As an insurance provider, you are most likely seeing your industry change drastically around you. Your clients look for a level of stability and constancy in their providers and disruption and change are not always a welcomed or embraced. With or without an industry consensus, the insurance landscape is going through some fundamental changes. Technology, new risk pools, demographics and political forces all have a hand in this disruption. At IBM Think 2018 in Las Vegas, IBM Insurance Global Managing Director Sandip Patel, spoke to this disruption while discussing what a provider can do to stay relevant in modern times. He also introduced an insurance provider that not only met this disruption head-on, but has embraced it successfully and prosperously. Sandip asks, “It’s not about running after the next big insurtech, it is about how to be relevant in the digital ecosystem forming around us. Will insurers spend their time playing catch up or enabling processes and platforms to leverage data and be relevant to customers?”

“Data is the new natural resource”

Customers look to their insurers to be their risk advisors. They want their providers to give them the best possible advice. They ask for their insurers to help them make informed decisions based upon the most amount of information that is available. To that end, Sandip says in response to the vast amounts of data generated every day ”that data is the new natural resource.” In insurance, the businesses who are capturing this massive amount of information are leading the way. They are not only giving their clients fact-based decisions from data capture and analyzation, but they’re finding new ways of profitability and new revenue streams from them. To make data relevant, insurers are newly leveraging business technologies such as machine learning and artificial intelligence, Internet of Things, wearables, software as a service, and blockchain technology. Each of these components make up the thriving insurtech industry.

Relevancy is found in new ideas

The digital ecosystem, or the consortium of businesses and individuals that work together to create combined insurance services at value, continues to grow. This raises the fundamental question of how do insurers keep pace and stay relevant? To answer that, Sandip states simply that the businesses and individuals that are not afraid to take risks and be the most innovative are the ones that are finding the most successes and profitability in the new digital ecosystem.

These pioneers are “transforming the traditional paradigm of insurance,” Sandip explains. They are building, through technology, new capabilities for their customers, taking advantage of big data and IoT to build new and improved services for their customers. “Engagement drives your brand” as Sandip describes, these advances in technology create a better client-to-customer relationship. Besides improving customer relationships, finding business opportunities also creates new revenue streams for providers. New areas of business and revenue pools, thanks to technologies like IoT and cognitive, are there for the taking.

From big bet to big jump

The highlight of this session was Sandip inviting his guest, Dominque Uzel, CEO and General Manager of Groupama Assicurazioni, the Italian subsidiary of the French insurer Groupama SA, to the stage. Groupama has over 34,000 employees and 13 million clients across Europe and Asia. Primarily, Groupama Assicurazioni offers insurance and re-insurance services in both the life and non-life sectors, but they are hampered by high costs and limited technological potential of their previous telematic service provider.

In 2015, Groupama made a big bet and designed an IoT investment strategy to fundamentally change the traditional business model in the insurance market. To coincide with this strategy was the release of the value added service My Angel mobile app (Italian), which augmented customer service into an addictive, user friendly experience. In just a couple of years, Groupama’s big bet of investing into capturing and utilizing IoT data then transformed into a big jump. With assistance from IBM, Groupama was able to collect data from IoT devices, analyze that data, then act on and monetize that information into B2C real-time risk prevention services. Further, they utilized IBM’s analytics tools and skills into cross-industry B2B data-driven business solutions and data monetization.

Together, IBM and Groupama implemented Watson IoT for Automotive to provide the multinational insurer with an end-to-end solution covering the spectrum of the telematics value chain (devices, connectivity, logistics, system integration services). The solution incorporated third-party solutions from MetaSystems and Telecom Italia Mobile. The implementation of this solution is projected to deliver a reasonable cost savings, measured on a per-device basis, for Groupama’s telematics-enabled auto policies alone.

Asked how his business remains relevant in this new digital ecosystem, Dominique echoed Sandip’s thoughts of not to be afraid of taking risks, embracing change and disruption, and also proclaimed that the customer relationship is paramount – “Explore best practices wherever they are. It’s about making life easier for your clients without forgetting they are an insurance company.” Relevancy in the new insurance industry is found through embracing disruption and change, as Groupama aptly continues to demonstrate.

Learn more about the new IBM Insurance platform here.

Click here for more information about Watson IoT for Insurance about Watson IoT for Automotive solutions here.

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