The insurance industry is centuries old. With business models focused on the long term, companies are sometimes slow to adopt technologies and trends. Traditional insurers are criticised for being dinosaurs at risk of extinction with no strategy for survival. But Switzerland’s Baloise Group (founded in 1863) is more than happy to embrace change. Its current strategy, Simply Safe, is all about customer focus. The aim for the next five years is to become a more agile, innovative and thus attractive company for employees, shareholders and of course customers.
Why insurance needs both technological and cultural change
New technology is crucial to this goal but not the only factor. Digitalisation – that buzzword used to describe the current technological revolution – is about much more than simply using new technology. The industry does this anyway. Insurers have always adapted useful technological advances for their existing systems and processes. This has resulted in a heterogeneous system landscape made up of both state-of-the-art technology and what are now probably antiquated databases and interfaces. Digital technology per se is not the real challenge.
Digitalisation is the result of a fundamental change in the demands of the digital generation – a paradigm shift that threatens to overwhelm the industry. Taking their cue from the consumer products and service industries, which were among the first to create digital business models, customers today expect a different speed and level of usability than in the pre-internet era. To keep pace, companies need more than the latest technologies. They have to adapt their (working) culture to the challenges of the increasingly digitalised world. The digital transformation should thus be seen as a social transformation, one made all the more complex by the ‘human factor’.
The Baloise Group is adjusting to this complexity with its Simply Safe strategy, launched in 2017.
How Baloise became Switzerland’s most innovative insurer
Baloise’s multidimensional approach will make it more agile and innovative over the next five years. Its unwavering aim will be to constantly surprise and delight its customers and to simply make their lives safer. The strategy thus focuses on continually optimising the core business while offering services in upstream, downstream and adjacent market segments, such as prevention, rectification of damage and insurance-related services. Baloise is extending beyond traditional insurance business and positioning itself in Europe as one of the most adventurous and innovative insurers. These efforts recently earned Baloise the insurance industry’s innovation prize.
A key factor in Baloise winning this award was its strategically intelligent partnerships with young start-ups.
Cooperation with KASKO to boost technological and cultural change
In collaboration with Baloise, KASKO has launched insurance innovations – its middleware-supported ‘insurtech as a service’ – across Switzerland and Europe within a very short period. The elimination of dependency on legacy systems, leading to benefits in terms of time, costs and, above all, flexibility, is not the only advantage of the partnership: the resulting momentum can be seen both internally and externally, showing that it is possible for a long-established insurer to move with speed, agility and – in the digital age – entrepreneurship. This was only possible because Baloise understands digitalisation and thus its partnerships with insurtechs as technological collaboration and, in particular, as a cultural exchange. Besides the product success that Baloise and KASKO have achieved together, their alliance is also helping to drive the urgently required cultural change and make it part of their DNA.