“I am going to talk about an industry that used to be a bit boring, but is getting pretty exciting these days, because digitalization is coming our way as well” Oliver Bäte opened his speech and then took the audience on a journey into the digital future from an Allianz perspective.
Many industries have changed massively over the last 20 years: booking an airplane ticket happens online and no longer in a travel agency. Buying a CD and having a player have been replaced by music streaming, where customers can choose according to their individual preferences, anytime, anywhere.
In contrast to this, the insurance business model has fundamentally not changed over the last few decades and is still based on more or less the same products as in the past. According to Bäte “that is going to change very soon, very quickly”. While customers can already compare, for example, a motor insurance policy online, this is still nearly impossible for life insurance products. And the few apps to notify or track a claim, for example, are just the beginning.
Going forward, Allianz can build upon a strong position developed over the last 125 years, whether regarding performance, trust or health. “Unfortunately, all of this will be challenged and is fundamentally changing as we speak, and this is not only due to digitalization”, warned Bäte, and explained the challenges arising from macroeconomic development, massive regulatory changes or other general industry trends.
“Focusing on digitalization, the key paradigm shift is not coming from technology. It is coming from the fact that technology enables us and others to develop new products and services to better serve the customer. So we need to take technology and entrepreneurship to deliver better products to customers, with better service at a better price.”
Bäte continued: “For Allianz, the number one priority is to understand everything about our clients, to provide added-value to them in future.” This implies a change in working together with the customers and Bäte highlighted: “The most profitable and fast growing businesses in the future will be those who achieve the highest customer satisfaction.”.
Understanding the customer is key
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Digital Paradigms of ME – FREE - EASY
“The digital world brings a lot of advantages, allowing for personalization, higher transparency and simplicity”, Oliver Bäte referred to the following paradigms: ME, FREE and EASY, that are closely interlinked.
In the past, regulators set the standard for insurance products – nowadays, customer can compare products online to get a better offer. Much more freedom to choose leads to higher transparency and benchmarking of offers. “Using the word insurance and easy in one sentence was an oxymoron a few years ago”, but Bäte explained that this is changing fundamentally, using the Fast Quote approach in insurance as an example.
“Allianz has been driving these developments quite a bit over recent years and has many successful examples on offer in various countries. But now we have to make sure that these customer centric assets become scalable, so that we do not just invent something in a single country, but can harvest the best of those solutions globally.”
If a company like Allianz embarks on such a journey of transformation, many aspects to facilitate this process are needed: In case of Allianz, this is achieved by its Renewal Agenda.
After explaining the five pillars of the Renewal Agenda in detail, Bäte moved on to how this is used to drive digital transformation: ”In a large organization like Allianz, all these components have to be integrated in a single digital agenda, as we call it”. It consists of four components: a Global Digital Factory, to make sure that product ideas are globally scalable; Digital Partnerships & Ventures, to be much more connected to global innovative and entrepreneurial arenas; Advanced Business Analytics to get access to data and make use of it – in close cooperation with clients and with a clear understanding what is really meaningful to them; and a Digital Demand Hub, to ensure that the right priorities are set and the best partners and technology are chosen to realize value-adding solutions to customers.
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