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Ecosystems in the insurance industry

Customer loyalty through complementary offers

Identifying customer needs and using them as a driver of growth

Ecosystems are characterised by the fact that the customer benefit achieved via positive network effects exceeds the sum of the individual services of the providers participating in the ecosystem. Customers expect holistic services that fit their situation in life. Ecosystems, partnerships and platforms are therefore becoming increasingly more relevant.

For insurers, this means no longer just offering products for specific risks, but rather solutions for specific situations in life. Products are integrated into customised solutions supplemented by suitable services. The customer is addressed in a solution-oriented manner and given the best support possible, and well-being is increased – reason enough to remain loyal to the insurer and recommend it to others.

Ecosystems represent a good chance for insurers to increase their business volume. Some established examples of this include the fact that a mobile phone provider offers device insurance at purchase and the fact that a home insurer offers services in and around a customer’s home in addition to insuring it, such as arranging suitable craftsman services.

Seeing challenges as opportunities

Ecosystems present insurers with a number of challenges that have to be overcome. In the market, there are already networks in their initial stage which are not yet called ecosystems but certainly exhibit a fitting character or have the potential to develop into such. Therefore, the first step is to put yourself in the shoes of the insurance customers and identify their needs. The next step is to gather ideas for solutions and evaluate them.

The insurer does not necessarily have to be the ecosystem operator, it can just as easily integrate itself into an ecosystem for a specific sector of life, for example, a car company’s app. In the event of a claim, this app can act as the customer’s central control centre for managing all their claims processes. The insurer must then ensure that its solution can also be implemented:

  • Processes must be modelled to suit all stakeholders.
  • Systems’ technical interfaces must be aligned in such a way that integrations can be made on platforms and in networks.
  • Professional interfaces must ensure that all internal systems can continue to be operated.
  • Partners may need to be found, which can be a time-consuming process.
  • The solution must be made known to the end user.

Developing ecosystems constitutes a major challenge for an organisation. Disruptive approaches are uncomfortable, and people like to stick to what they know. The changes need to be actively managed. Challenges exist at every level, but they also offer the insurer the opportunity to optimally position itself in order to retain existing customers and find new ones.

Using technological progress to seize opportunities

Developing a functioning ecosystem requires a solid technological foundation. In addition, the hurdle to participating in an ecosystem must be low and the effort manageable. The speed of development and integration must be increased to match the development of the market.

Standardising interfaces

Interfaces between the applications of the companies involved in an ecosystem are a key factor that determines the success of the overall system. Any errors in communication can lead to customers rejecting the service and thus to the failure of cooperation within the ecosystem. Therefore, it is a good idea to use standardised interfaces that are developed by associations such as the Industry Institute for Process Optimisation (Brancheninstitut für Prozessoptimierung, BiPRO) and enable the mapping of core processes in the insurance industry.

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Modular development allows for reuse and short release cycles

Recurring challenges should be outsourced to reusable, clearly defined components in order to avoid the need to keep reinventing the wheel. This principle also applies when developing ecosystems, as using modules, such as policy calculators, in a targeted manner accelerates the integration of individual use cases. Using established modules, for example, to map application routes, or a proven digital signature procedure avoids costly new developments and shortens required test phases.

Data forms the basis and makes ecosystems valuable

An ecosystem is based on the benefits, services and business models, on the basis of available data or the data to be procured. A company needs a solid database in order to be able to offer new services within the ecosystem.

A data ecosystem drives growth, which includes the integration of partnerships, customers, suppliers or external sources. Having a common data platform is the key to creating new added value.


What we offer

Identifying an ecosystem and, in the next step, establishing and expanding it in a sustainable manner requires both in-depth knowledge of the insurance industry and processes as well as technological and architectural expertise. adesso uses established methodologies such as the Interaction Room to bring together business and technology and work with you to develop a sustainable structure for implementing an ecosystem.

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