Across the insurance industry, carriers are increasingly aware of both changes in market dynamics and the shifts in opportunity (and risk) that technology advances bring. For many, this is a notable challenge. Long tail liabilities and a general aversion to risk, combined with corporate cultures that can create notable headwinds to change, can make internal “innovation” a daunting journey to embark on. The corporate culture can be thought of as an immune system; part of the function is to protect the “body” from threats that deviate from an organizationally acceptable pathway.
While some carriers attempt to pursue internal efforts irrespective of the challenges, others have chosen to make specific investments or commitments to participate in insurance-focused innovation accelerators that allow an early view into developments. This can also allow early opportunities to invest in, or acquire, capabilities. One of the first insurance focused accelerators was in Des Moines, IA. We now see growing interest in Hartford, CT, as an area of concentrated focus. Another announcement came this week with a partnership between Crawford & Company and the Hartford InsureTech Hub.
MetLife is taking a different approach, having established two new InsureTech related investment funds. Part of this effort will be to identify promising startups that can be invited to join an accelerator hosted at MetLife’s Global Technology Campus in Research Triangle Park, NC. This places the accelerator in the immediate proximity of MetLife’s own IT organization.
These are fascinating developments, of course. Only time will tell how successful they will be. One of the key environmental factors supporting real innovation is the ecosystem that these startups are embedded in. Places like Silicon Valley in NorCal have a definitively unique combination of factors that create an impressively fertile environment. Recreating this in other places has proven surprisingly difficult, with RTP itself perhaps being a good example of a successful effort. That said, RTP’s origins go back 60 years, so it is hardly an example of being able to go “full to bright” quickly.
Innovation is about experimentation, failing fast, trying again, and repeating the process, incorporating lessons along the way. The efforts carriers are making now are very important to pay attention to so that other carriers can make informed decisions. The future is, indeed, already here. And in the words of William Gibson, it remains unevenly distributed.
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