written by Fabrick
Over the recent months, the PSD2 has triggered a true revolution that is evolving in its form and is leading to open finance, involving not only the banking industry but also other sectors. In the wake of this change, the insurance ecosystem has also opened up to external players and is even more adopting a partnership-oriented approach.
Dealing with these new challenges and business models requires an increasingly evolved and structured operational approach, in which collaboration and cooperation with external players become a must to offer customers solutions with higher added value.
Fabrick proposes itself as a partner in this process. Through its technological platform and its ecosystem of relationships, the company promotes and enables new growth models for all the realities of the sector by facilitating the co-creation of solutions that meet the increasingly advanced needs of end users. Our goal is to be an enabling factor in this market and to give an active contribution to all the operators involved, from the end customer, who is the ultimate beneficiary of this process, to the distribution network, the broker, and the company as a whole. Fabrick aims at facilitating the process of transition and transformation that, although enabled by technology, presents complexities in areas beyond technology.
The evolution of the insurance industry is an inevitable and unstoppable change that companies need to be ready to embrace by equipping themselves with the appropriate tools to ensure maximum interoperability with external ecosystems and by using platform models to combine different services.
Thanks to open finance, insurance companies can modify and automate their internal processes, redesigning their organizational model while increasing the level of efficiency and service for the end customer.
In this new, increasingly digital context, the payment management becomes a key competitive factor, playing a pivotal role in the client’s customer journey and in his relationship with the agency itself. The importance of digital payments is confirmed by the numbers: globally it is the largest and most promising fintech segment with a value of over 5,200 billion dollars. From this point of view, the Italian market shows a high potential having almost 20% growth project by 2025, the biggest jump in Western European countries.
To be competitive, insurance companies must integrate solutions into their systems. This will allow them, on the one hand, to equip themselves with the broadest possible set of electronic payment tools, thus meeting the demands of an increasingly demanding and digital market, and, on the other hand, to optimize and automate the payment process and its reconciliation thanks to centralized and controlled upstream management. Therefore, the trend that emerges is towards the adoption of solutions designed to bring added value to the entire supply chain, from the end customer to the network of agents.
Another ongoing trend is the evolution of the offer towards the so-called “beyond insurance”. Thanks to business ecosystems open to more economic players, the collaboration between startups and insurance incumbents will be extended beyond the traditional boundaries of the sector, allowing to offer wider services in which the insurance policy becomes an extra.
Therefore, the open platform and the automation of payment processes, or, more generally, of pre and post sales processes, through the technological enablement of an ecosystem, provide the company with the possibility to offer both new business models and new products that, through a more efficient and flexible payment method, can be conveyed in a different way to the customer.
It is undeniable that open finance has sparked a revolution in both banking and finance. However, as far as the insurance world is concerned, there are still obstacles to this process, mainly linked to traditional market logics.
The availability of technologies and the willingness of players in the insurance sector to adopt new forms of business, based on cooperation and co-creation of solutions, are not sufficient on their own. To be functional and generate value, these elements must coexist with an effective change in the mindset of the entire organization, starting with the agency network.
Therefore, the insurance industry is very careful not to put the use of technology in opposition to the human factor, by promoting training programs aimed at developing the correct approach to these processes and increasing the awareness of the benefits of open finance.
