I'll warn you: I'm grumpy.
I'm seeing an awful lot of sloppy language that obscures the highly worthwhile innovation happening in insurance, and I need to vent. So I shall.
Let's start with the biggies — I'm looking at you, "transformation" and "disruption." Those words get tossed around so casually in insurance that they've lost all credibility.
The internet transformed commerce and just about everything else. The iPhone disrupted communication. A system that is designed to make underwriters 10% more efficient and that might actually deliver 2%? Not so transformational or disruptive....
And our weakness for lofty language can make us soft-headed, so we describe improvements in the most abstract, high-minded way imaginable... and lose all meaning. Just in the past week, I've seen a company describe itself as a provider of "intelligent water solutions." What's a water solution, intelligent or otherwise? Another company called itself a "service provider." As opposed to a product provider?
The industry's innovation is important, and we're pressing forward on so many fronts that we're continually improving. We can do so much better by our clients, our investors, and ourselves if we can just sharpen our language about what we're doing — and not doing.
I have thoughts.
If I had my way, I'd just dispense with all the forms of "transformation" and "disruption" for the time being. Yes, both are possible. Generative AI looks like it will deliver major, perhaps even transformative, efficiencies all across the board. I'm also bullish on the possibilities for the Predict & Prevent business model, which would turn the traditional approach to insurance on its head by selling what people really want — security — rather than indemnifying them after a loss (as important as that is).
But any disruption will take time, and, in the meantime, we've been hitting the transformation claims so hard and for so long that they've become background noise for clients and investors. I also worry that we may be breathing our own exhaust. I watched IBM fall apart in the late '80s and early '90s as executives fell for their own claims that they were leading the innovation in personal computing and were the low-cost producer. I don't want anyone in insurance to get complacent about how much work lies ahead of us.
In journalism, stories are generally cut from the bottom, because the more important facts had better be up high, but at ITL I reasonably often find myself cutting articles from the top, sometimes eliminating the first two or three paragraphs. The reason? A fair number of authors begin with broad claims about transformation and disruption on behalf of the industry, and we've all read that kind of thing before. I want to cut to the chase and get at what's actually new.
I also may cut references to studies because they're just designed to make us all feel good (and to get quoted) without shedding any light. For instance, Bloomberg reports that Gen AI could become a $1.3 trillion business in the next decade. But what's a Gen AI business? Sure, Open AI, Gemini, and other large language models are Gen AI businesses, but what else is getting lumped into that number? Apple is about to unveil iPhone models that will incorporate AI into Siri. Does that mean sales of those models will count toward Bloomberg's number? Some percentage of sales? I've begun using an AI to do preliminary editing on articles I publish. Do my time savings count toward Bloomberg's number?
Again, I'd argue for precision — who's doing what to whom, when and how? — rather than toss around big numbers as part of our grand concepts.
A lesser, but still important, issue is that far too many companies can't seem to be precise about what they do. It's almost as though they've taken their mission statements and turned them into company descriptions without accounting for the fact that the external audience has none of the context that the internal audience has.
A company that sells technology that detects water leaks may see itself as being in the business of water solutions, but the rest of us don't think about "water solutions." A company may imagine itself "a property and casualty insurance organization that prioritizes simplicity, transparency, and savings," but that sounds like motherhood and apple pie to me. Doesn't everyone value simplicity, transparency, and savings? Why not delete the statement of values and tell me specifically further down how you differ from your competitors (if you, in fact, do)?
And whatever you do, don't get so caught up in the flowery language that you lie to me. An announcement last week said a company was turning claims into a profit center for agencies. In fact, the company sells a system designed to speed claims, saving money for the agency while making customers happier and more loyal. A profit center is a distinct business with its own profit-and-loss statement, so you can save me all the money you want and increase customer loyalty like crazy, but your system still doesn't create a profit center for me. Credibility... gone.
I understand the need for marketing and for companies to generally talk up what they do. I'm just saying there needs to be credibility about the claims, both because we need to have the trust of external audiences and because we need to be honest with ourselves.
Back in the 1990s, when I was still at the Wall Street Journal, a trend developed among the start-ups I'd meet with. Every single one began its presentation with a slide saying they had the best people. I came close to telling an entrepreneur or four, "No, you don't have the best people. The three start-ups I met with last week have the best people. They told me so, and I have their presentations right here."
I guess this isn't the first time I've been grumpy.
Cheers,
Paul
P.S. Two nits:
- I'd avoid the word "digital," as in the company that recently described itself as "the technology leader that unlocks the potential of digital insurance." Digital is the water we swim in, the air we breathe. The transistor, which made digitalization possible, was invented going on 80 years ago. The microprocessor was invented more than 50 years ago. Apple is about to hit 50. Google has its 26th birthday next week. "Digital" just doesn't have the cachet it once did, and there are much more precise ways of describing what you're doing — in terms of operational efficiency, moving transactions online, or whatever.
- Loads of companies make their descriptions hard to read by just jamming a string of modifiers together in front of whatever the main noun is, often with hyphens connecting them. Here is a mild example from the past week: "the leading financial operations automation platform for insurance businesses." God created pronouns, prepositions, and verbs for a reason. That description would read so much better with just two additional words, as "the platform that automates financial operations for insurance businesses." (Yes, I took out "leading" for a reason. It's a harmless enough word and is certainly used a lot, but if you're really a leader then you don't need to tell anyone. They'll know. Nobody needs to tell you that Steph Curry is a "leading" basketball player.)