Celent has released a new report titled The Implications of Pay As You Use Insurance: A Scenario-based Analysis. The report was written by Michael Fitzgerald and Juan Mazzini, senior analysts in Celent’s Insurance practice.
New York, NY (Dec. 5, 2016) – What if insurance pricing changed from being based on rating tiers to price varying according to how often insurance is used? In this future state, the frequency of use of an individual user drives pricing. This report is the second in a series that details a scenario planning model which helps insurers extract clarity from confusion.
Future changes in market size, customer/company relationships, required skills, the competitive landscape, and the urgency of the scenario are factors considered in the scenario analysis. Celent expects pay as you use pricing to decrease the size of the market, provide more regular customer-company engagement, require development of significantly different skills, and make the landscape more competitive. The report also demonstrates how the process and results of scenario planning can be used to build consensus across the organization regarding priorities and to determine the best approach to business model changes.
“Pay as you use insurance is one of several changes underway which will impact the basic operation of the traditional insurance product,” commented Fitzgerald.
“The skills required to successfully manage pay as you use insurance span actuarial, product development, marketing and IT. Insurers moving to experiment with this approach now are learning critical capabilities which will give them a head start on their competition,” added Juan Mazzini, coauthor of the report.
Click here for the table of contents or to purchase the report from Celent.
Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies (NYSE: MMC).