Future of Insurance

Rafal Walkiewicz

September 2, 2015

2015 Entrepreneurial Insurance Symposium

The Insurance Industry ExpertsNew York London Hong Kong Sydney

How To Win in the Technological Revolution?

2

“Sustaining innovation” will not save you from extinction

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Do All Leading Innovators Eventually Fail?

3

To survive companies must embrace “Disruptive Innovation”

Diminishing Returnsof Sustaining Innovation

Resource Allocation Dilemma

Focus on Short TermProfit

Innovation Traps

The Insurance Industry ExpertsNew York London Hong Kong Sydney

How Technology Disrupts P&C Insurance?

4

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Internet of Things – Making Life Easier

5

Who owns the data?

Who distributes “things”?

Who has algorithms to analyze data?

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Self Driving Cars Don’t Need Insurance

6

Telematics Autonomous driving

Premium Falls Premium FallsPremium moves

to Commercial Writers

Personal auto insurance premium will eventually disappear

We are investigating telematics and broadening the value proposition for the connected customer. If we are not effective in anticipating the impact of changing technology, including automotive technology, our ability to successfully operate may be impaired.

- Allstate (currently $18bn of auto DPW, 66% of total premium)

U.S. market shrinks from

$180bn to $120bn

U.S. market shrinks from

$120bn to $80bn

$80bn of premium from car manufacturers and infrastructure providers

2020

Safety

Now 2030 2040

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Auto Insurance Disruption – How to Fight Back?

7

Who distributes “things?

Who owns the data?

Who has algorithms to analyze data?

The Insurance Industry ExpertsNew York London Hong Kong Sydney

What About Life?

8

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Wearables – Making Life Longer

9

Why would customers agree to forfeit privacy?

Internetof Things

P&C Life

Making life easier Making life longer

Life (mortality) insurers’ interests are well aligned with customers

The Insurance Industry ExpertsNew York London Hong Kong Sydney

End of Illness

10

Better Prediction

Healthy Lifestyle / Preventive Medicine

Youth Elixir/ End of Illness

Genetic Predispositions

Behavioral Choices

MedicalAdvances

Big Data

Life Insurers

Health Insurers

Healthcare Providers

“Things” Manufacturers

Pharma

The Insurance Industry ExpertsNew York London Hong Kong Sydney

Can Insurers Benefit From Disruptive Technology?

11

Thank you