While it's tempting to see the world in blacks and whites, my experience with innovation is that it typically happens in grays, at least for years. Even when a company has a breakthrough idea and captures the imagination of investors -- Amazon with e-commerce, Tesla with electric cars, AirBnB with room and home rentals -- it takes time for reality to fill in behind the stock market valuations.
Distribution in insurance has, I think, been living in a world of grays for some time now. It's been clear that technology can do a lot to improve interactions with customers and sharply increase the efficiency of agents and brokers, but there's been no aha moment.
In fact, what many thought was a clear vision of the future -- that agents and brokers would be disintermediated as carriers set up direct relationships with customers -- has turned out to be false. If you look at valuations of agencies and brokerages, they've actually expanded their role and power in recent years.
Instead of disintermediation, I think the future will be a hybrid of agents and brokers and technology. For now, the human element will dominate. Over time, the role of technology will increase, steadily taking on more and more of the mundane work and freeing (while also pushing) agents and brokers to focus more on providing high-value counsel.
To see how that future plays out, you could do a lot worse than follow the progress of VIU by HUB, which provides a digital platform for customers to see multiple quotes on auto, home and life insurance and to have an agent contribute as needed. VIU pretty much fits my vision of what the future will look like, which is why I was delighted to get the chance to conduct this month's interview with Bryan Davis, the EVP in charge of VIU.
Insurance distribution could still have what I think of as a Hemingway innovation moment. A character in his "The Sun Also Rises" said he went bankrupt two ways, "gradually, then suddenly." But I think innovation in distribution will stay in the "gradually" stage for the foreseeable future, with important innovation certainly happening, just on a curve with a steady upward slope, rather than one with a "suddenly" disruption in the graph.
Cheers,
Paul
P.S. Here are the six articles I'd like to highlight this month for agents and brokers:
AUTOMAKERS BUILD NEW INSURANCE FUTURE
As data and technology pervade the car manufacturing industry, automakers have made fresh inroads into insurance.
THE DEATH OF 'THE ROBINSONS'?
"The Robinsons." who bundle home and car insurance, represent the crown jewel in customer lifetime value. But the segment is very much at risk.
3 WAYS DE&I CAN BOOST AGENCIES
Data has shown that, compared with individual decision makers, diverse teams make better decisions 87% of the time.
HOW RISK MANAGERS, BROKERS MUST COLLABORATE
Solutions can address brokers’ administrative risks from within, in a way that focuses on the customer/risk manager experience and leads to vastly improved alignment.
CYBER TRENDS THAT WILL CHANGE 2023
Here are six cybersecurity and incident response trends and priorities that can help organizations in 2023.
10 TIPS FOR LEADING TEAMS
What does it take to be a successful leader? How can you lead change effectively? Here are 10 tips that can help you lead change in the insurance industry.
