Asia: McKinsey says region's insurers need to seize digital opportunities
Source: Asia Insurance Review | Dec 2019
Asian insurers need to take charge of the opportunity that lies ahead of them or lose out to fast-paced, digital natives entering the insurance market, says global consulting firm McKinsey.
In a report, McKinsey said, “To remain competitive and sustain continued growth and market share, incumbent insurers must build their own digital and advanced analytics capabilities.”
Its research shows that digital leaders increase revenue at five times the rate of other companies and total shareholder returns by two times — which is a significant motivator for business leaders to jump-start their digital projects and programmes.
According to the think tank, digital analytics is a stepping stone to digital maturity and a significant first step on the digital transformation journey. While it isn’t too late for those that are yet to get started, McKinsey’s consultants believe that leaders in the insurance space need to adopt a sense of urgency in order to leverage analytics to build scale and stay ahead of new-age disruptors.
Incumbents need to tap into their data repositories and find ways to inject digital analytics into everyday workflows. In order to get started with data analytics, McKinsey provides two strategies for traditional players in the insurance space. These are:
- Reinventing the core business
- Building new businesses
McKinsey says the choice of strategy need not be mutually exclusive — companies could choose to pursue both simultaneously if they have the resources and capabilities necessary. A