The role of collaboration in the insurance industry
Bryan Falchuk of Insurance Evolution Partners discusses the importance of partnership between legacy insurers and insurtechs based on research from his latest book.
The insurance industry has changed significantly over the last several years with new risks emerging due to factors like cyberattacks, the sharing economy and the pandemic. Add in the constant technological evolution as carriers streamline their processes to better serve policyholders, and there have been a wide variety of changes. While insurers understand the importance of working with customers to identify and mitigate risks, sometimes it’s easy to forget how important it is to collaborate in other areas, especially when it comes to implementing new technology.
Accenture says, “Overall, the consumers who reported not being fully satisfied could represent up to $34 billion in premiums annually, or up to $170 billion over the next five years.”
Claims is the beating heart of insurance service providers. It is the moment when insurers convert a policy into the financial help needed following a calamity, and it’s the point at which the sector proves its worth and makes good on the customer’s trust.
With such high stakes, you’d think insurers would do everything in their power to ensure a smooth, frictionless and stress-free claims experience. Yet, according to PwC’s Insurance Brand Sentiment Index 2022, something is going terribly wrong.
Many consumers prefer working with an agent or broker for insurance, despite direct-to-consumer platforms that offer an alternative.
It’s a new era for independent insurance agents and brokers. There are challenges with the continued economic turmoil, rising premium costs and changing customer needs. They’re also facing increased competition. The estimated total number of independent insurance agencies in the U.S. grew from 36,000 in 2020 to more than 40,000 in 2022 — a 9% increase. Many independent insurance agents and brokers have needed to adapt and do things differently to maintain their success. It has been a wake-up call. They can no longer avoid disruption or change.
However, there are also exciting new opportunities and paths for independent insurance agents and brokers to grow their businesses and earn revenue by taking a fresh look at how technology can help.
The landscape of small-to-medium commercial insurance has experienced steady growth in recent years. With global property and casualty premiums growing at an annual rate of 6-8% since 2018, the commercial lines sector has emerged as a critical area of opportunity. Factors driving this expansion include hardening market conditions, insurer exits from states like Florida and California, and a rising need for tailored coverage solutions to address unique risks. At Skyscraper Insurance, we recognize the importance of adapting to these market dynamics and providing our clients with tools and strategies to thrive. Here’s how businesses can make commercial lines insurance work smarter for their needs. The Power of Diversification Expanding into commercial lines is a proven way to increase profitability while mitigating risks. By offering cross-sector solutions — from specialized liability to industry-focused coverage — businesses can grow their client base while addressing underserved needs. Skyscraper Insurance makes this transition seamless, providing expert guidance and comprehensive options to diversify your portfolio effectively. Streamlining Quoting Processes Traditional quoting methods can be labor-intensive and error-prone, deterring many agencies from fully exploring the potential of commercial lines. With advanced technology, Skyscraper Insurance simplifies this process. Our integrated tools allow businesses to enter data once and receive competitive quotes from multiple carriers in minutes, ensuring clients receive the best possible options while saving time and reducing administrative burdens. Reducing Errors Through Automation Human errors in data entry can disrupt workflows and introduce risks. By leveraging cutting-edge automation solutions, Skyscraper Insurance ensures data accuracy across platforms. Our systems seamlessly integrate with agency management tools, minimizing redundancies and enabling faster policy renewals and claims processing. Embracing a Connected Future Commercial lines insurance offers vast opportunities, but success hinges on embracing digital transformation. Skyscraper Insurance provides the tools needed to connect management systems, automate renewals, and streamline carrier relationships. By adopting our “one-to-many” quoting model, businesses can optimize efficiency, improve client satisfaction, and drive profitability. Partnering with Skyscraper Insurance In a competitive and evolving market, having a trusted partner makes all the difference. At Skyscraper Insurance, we empower our clients with tailored solutions, innovative technology, and industry expertise. Whether you’re expanding your book of business or exploring new opportunities in commercial lines, we’re here to help you navigate the complexities of 2025 and beyond.
As 2024 comes to a close, it’s clear the year has been challenging for insurers. However, as we look ahead to 2025, the industry appears to be in a much better position. The reinsurance market shows signs of stabilization, with improved terms and conditions. There’s broader adoption of insurance-to-value (ITV) measures and rate adjustments aligning better with risk. While this positive momentum is promising, challenges like natural catastrophes, rising claims, and social inflation remain. Positive Momentum in the Insurance Industry The industry is benefiting from hard decisions made in recent years, including necessary rate adjustments. Coupled with strong equity performance and a renewed focus on underwriting profitability, many insurers are experiencing surplus growth. Economic factors also contribute to this progress. Home construction has slowed but remains steady, unemployment rates are manageable, and consumer confidence is stable. Additionally, improved ITV measures have strengthened the industry’s foundation, with insurers like PLM reporting significant growth in this area. Accurate valuations, combined with solid underwriting and better rates, set the stage for continued success. Key Challenges Ahead Despite progress, significant obstacles lie ahead: A Path Forward To thrive in 2025, insurers must maintain discipline and adapt strategically: While challenges persist, the industry is better positioned than it was a year ago. By staying disciplined and proactive, we can make 2025 a year of growth and resilience.
