MARCH 20208IN MY OPINIONCapitalizing on Commercial Insurtech Disruption By Marcus Knuth, Vice President ­ Enterprise Technology, Acuity InsuranceMarcus KnuthLook back to insurance technology news from about 20 years ago, and you will find a lot of discussion about personal lines SEMCI. Over time, the original, modest goal of "single-entry" expanded to encompass the ability of insurers' systems to seamlessly integrate with multiple types of third-party systems and services. Today, those third parties comprise what is now known as the insurtech sector, and the way that personal lines insurance is sold and serviced has been truly transformed. The growth of the insurtech sector in recent years has been nothing short of explosive. According to research from McKinsey& Company, global investment in insurtechs grew nearly tenfold from 2011 to 2017--from $250 million to $2.3 billion. Although personal lines has seen the vast majority of this investment, commercial lines is gaining ground. And, just as in personal lines, commercial lines will see a disruptive impact from insurtech, including agency-to-carrier automation, direct-to-consumer quoting, online comparative rating, and more. For growth-focused insurers, it's not a matter of whether to integrate with commercial lines insurtechs, but how far they will be left behind if they delay. As happened in personal lines, commercial customers and agents will dictate how they want to interact with a company and will direct their business to the channels and carriers that support that interaction. Therefore, insurance CIOs need to maintain a sharp focus on their company's ability to integrate with insurtechs. They must promote efforts to transform their commercial lines backend processes and extend them via APIs and microservices. Doing so not only ensures a company will be a viable player in the commercial insurance marketplace, but delivers several other benefits as well.Increased efficiency. Regardless of the technology or method used, insurtech integration is about ensuring that back-end processes can be easily exposed for integration. The user interface for commercial data collection will continue to change, but processes for dealing with this data should be the same regardless of source. For instance, Acuity's systems development is focused on creating and maintaining a headless architecture. Our goal is to develop capabilities that are processed the same way regardless of the channel in which the request originates (agency management system, third party website, our own online quoting system, etc.). In addition, system transformation delivers many other efficiency benefits as well, including ease of maintenance through consistency and standardization and the ability to do more rapid development through component re-use, along with greater overall
< Page 7 | Page 9 >