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Are Personal Lines Insurers Investing in Foundational Technologies?

New SMA Blog by Mark Breading, Partner, Strategy Meets Action

The personal lines segment of the insurance industry is quite active today, with many initiatives and projects underway across the value chain. For many, the objective goes beyond incremental improvements to positioning the company for fundamental transformation. The many projects planned or in progress fall into three categories: Digital Enablement, Core Transformation, and Data/Analytics. A newly published SMA research report, Foundational Technologies in Personal Lines Insurance, details the projects and initiatives underway in 2019 and beyond.

One of the major challenges we observe in personal lines is the struggle to balance the need to establish a modern, competitive foundation with incorporating new technologies to position for the future. Most insurers have very long lists of projects for things like enhancing portals; replacing or upgrading policy, billing, or claim systems; modernizing business intelligence solutions; and more. These are the types of projects that SMA terms “Foundational,” precisely because modern solutions in these areas are table stakes for success today. Incorporating innovative solutions from InsurTechs and incumbent tech providers that leverage machine learning, the IoT, wearables, virtual payment technologies, and more are highly desirable but difficult to build into operational plans. These advanced types of solutions are what SMA calls “Transformational Technologies” and will be the subject of an upcoming SMA research study and report.

All the excitement and visibility tend to center on the transformational technologies, and there’s no question that there is tremendous potential for innovation that can create competitive advantage. Yet the number one task for insurers today regarding technology is to ensure that the foundational technologies are in place to provide the levels of efficiency and effectiveness needed to compete while establishing a flexible base to build upon. This is not to imply that insurers should wait to engage in any activity related to transformational technologies. On the contrary, it is imperative that insurers monitor, learn, and experiment with the new technologies that are most relevant for their business. Thus, the challenges of finding the right balance!

One other aspect of technology strategy and plans should be explored: the need to implement foundational technology solutions that already have some embedded transformational tech. Policy systems can leverage chatbots and AI. Billing solutions can begin to accommodate more advanced payment methods. Claim systems should already be leveraging solutions that use machine learning for fraud. Many other examples could be cited as well.

Over time, the various transformational technologies will become foundational as many in the industry begin to incorporate them into their organizations. One by one, the advanced technologies will become table stakes, only to be replaced by a new set of transformational technologies, or at least by new, more sophisticated levels of the existing technologies.

There are a wide variety of strategic choices that senior leadership teams must make today. Allocating scarce resources and budget dollars is as difficult as it ever has been, if not more so. However, the successful personal lines insurers in the digital age will be those that find the right blend of technologies of all manner to create flexible, responsive organizations.

For more information, see the SMA research report, Foundational Technologies in Personal Lines: Investment, Adoption, and Business Areas.

Foundational Technologies in Personal Lines: Investment, Adoption, and Business Areas

The personal lines segment of the insurance industry is quite active, with many initiatives and projects underway across the value chain at insurers today. For many, the objective goes beyond incremental improvements to positioning the company for fundamental transformation. According to recent SMA research, half of all responding P&C insurers state that their company is in “transformation mode.” These insurers are the leaders that are reshaping the industry and positioning for further success.

This report provides survey results on investment, maturity, business area focus, and SMA trend analysis for 26 technologies that form the foundation upon which commercial lines organizations can drive transformation initiatives. The report is segmented into three areas: digital, core, and data and analytics. While personal lines may be adopting some foundational technologies for the first time, others are in a second generation. Understanding industry trends as they relate to internal strategic initiatives has never been more critical.

The following is an example of one of the project areas (Digital Platform) shown in the report.

Click here for the table of contents or to purchase the report.

About The Author

Mark Breading, a Partner at Strategy Meets Action, is known for his insights on the future of the insurance industry and innovative uses of technology. Mark consults with insurers and technology companies on forward thinking strategies for success in the digital age. His inventive methods and his ability to incorporate InsurTech and emerging tech into business strategies are unparalleled. Mark also leads SMA’s research program, has overseen the publication of over one hundred research reports, and directed custom research projects for insurer and tech clients. His thought leadership in the areas of InsurTech, emerging technologies, customer experience, and digital strategies has earned him rankings as a “Top Global Influencers in InsurTech” by InsurTech News and Onalytica and a place in the 10 finalists for the “Top Global IoT in Insurance Influencer Award.”

Before joining SMA in 2009, Mark spent 25 years with IBM, where he co-developed IBM’s Account Based Marketing program and led the global project office to implement ABM across all industry verticals worldwide. Mark has held both technical and business roles in sales, consulting, marketing, and business strategy and has advised insurers around the world for almost 30 years.

He is a frequent speaker at industry events; an InsurTech mentor with the Global Insurance Accelerator; and a frequent contributor of articles to Insurance Thought Leadership, Insurance Networking News, LOMA Resource, and many other industry publications.

About SMA

Exclusively serving the insurance industry, Strategy Meets Action (SMA) is an advisory services firm offering retainers, research, consulting, events, and innovation offerings to both insurance companies and solution providers. Learn more about SMA at

SOURCE: Strategy Meets Action (SMA)

One Comment

Patrick Vice,

Good stuff, Mark.

I’m just wondering how segments of various insurance buyers will respond to “transformational technologies” changes. I can see Millennials / Gen Zs responding fairly easily, but aging Boomers (present company) could become recalcitrant with new-fangled stuff.

Any thoughts?


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