"One key to surviving in a world of disruption, where theexternal environment is changing at lightning speed, is to changethe game internally." — John Kotter

The extraordinary adoption of digital capabilities is changingthe world at lightning speed, and the insurance industry is notimmune. In a recent survey of insurance consumers,PricewaterhouseCoopers found that 70 percent conducted someform of digital research before purchasing their policies, 26percent used a digital medium to purchase those policies, 67percent would be willing to attach a sensor to their home or car toreduce premiums, and 68 percent would be willing to download anduse an app provided by their insurance provider. Even moreindicative of digital's rapid expansion, industry CEOs told Forrester Research that theyexpect 56 percent of insurance revenues to be digitally generatedby 2020.

Unfortunately, the industry is not keeping pace with the changeswrought by this disruption. EY found that almost 80 percent of insurers donot see themselves as digital leaders and Forrester found that only9 percent feel they have mastered digital enough to use it as acompetitive differentiator.

Biggest challenges to digital success

What's holding insurers back? In a cross-industry survey by McKinsey &Company, structural and cultural issues pose the biggestchallenges to digital success:

  • Difficulty finding talent (functional and technical).
  • Organization structure not designed appropriately fordigital.
  • Business processes too inflexible for new opportunities.
  • Quality data and analytics to inform business decisionslacking.

The good news? Because these difficulties are largely internal,focusing on these three areas and rigorously measuring results go along way toward shoring up your digital strategy.

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