Going Digital

Talks of digitalisation has dominated the financial services industry, and the insurance sector is no exception. A survey by Willis Towers Watson reveals that an increasing number of insurers now regard investment in digitalisation a priority, especially after the sector has lagged behind its financial services peers in adopting digital technologies due to regulations, reluctance, and cost.

Insurers are finding smarter ways to grow their business through M&As beyond traditional acquisition targets. According to the survey, almost three-quarters of global insurers (74%) believe their sector has failed to show leadership in digital innovation. “Insurers recognise the importance of building a sustainable digital infrastructure
to improve customer engagement and as an essential distribution channel, which is likely to be addressed through a combination of internally driven innovation, joint ventures, and M&A activity,” said Nicholas Chen, head of digital solutions at Willis Towers Watson in Asia Pacific.

More acquisitions to come
Almost half of the survey respondents (49%) expect to make an acquisition over the next three years, directly driven by the desire to acquire digital technologies, including 14% who intend to make more than one acquisition. Nearly all respondents (94%) expect distribution to be the area where digital technologies have the greatest impact over the next five years.

Distribution is a recurring theme for insurers surveying the digital landscape, as it offers opportunities to find new ways to market, and to build closer relationships with consumers of their products and services.