Wimpie van der Merwe - CEO, Global Choices

Even in today’s period of rapid change, it appears that a lot of insurance companies are trying to create new solutions by counting on outdated paradigms. To overcome modern challenges, new paradigms are needed.

Fresh thinking from outside the insurance industry will drive the next wave of growth within the insurance sector. Design thinking may be a desired approach that shapes customer-centric innovation, but few companies do this well.

WHAT IS DESIGN THINKING?

Design thinking may be a methodology used to solve multifaceted problems and satisfy complex needs. It is a philosophy, a toolkit, and a process. What differentiates this method of thinking against the backdrop of other problem-solving techniques is a suite of core beliefs that are optimistic, human-centred, collaborative, and boldly experimental. It requires “designers” to get their hands dirty, embrace ambiguity and learn that the best ideas often come from collaborating with a diverse source of strengths, and remembering the vital insight of human truths.

DESIGN THINKING ANTICIPATES THE HUMAN EXPERIENCE FIRST

Empathy is the foundation of this human-centred design process, involving the work you do to understand people within the context of a design challenge. Technology cannot replace the power of empathy. Technology should act as a tool for people, and not the other way around. Yet many insurance companies put technology first. This is evident in the hype surrounding insurtech. Many of those solutions are designed round the instrument and not the human. Defining the customer and identifying the matter that you are trying to unravel will vary drastically among players across the value chain.

DESIGN THINKING DELIVERS INNOVATIVE IMPROVEMENT

One of the first steps involved in the design thinking process is to define the problem. Creating breakthrough value propositions isn’t about being incrementally better. It is about really making a difference. Looking beyond insurance, it is both remarkable and refreshing to witness the willingness of other organisations to bet big, fail fast, learn key lessons, and come back hard with improved offerings. The insurance sector can learn from these players. It is not just about providing good insurance products and customer experiences but about having customised policies on demand.

Insurance companies will also need to step in to help their clients with risk prevention and mitigation. To remain relevant, insurance companies are fighting a battle for client attention and retention on an unprecedented level, discovering that previously successful problem-solving methods are rendered ineffective by rapid changes in society. Human-centred insurtech can help with this.

DESIGN THINKING PROVIDES FOCUSED OBJECTIVES

To create innovative change, insurance companies cannot keep adding elements simply because their competitors do. This tactic will lead to solutions that are undifferentiated and too complex or vague. Many players within the industry still think they can be everything for everybody, but to be relevant and appealing they›re going to need a razor-sharp focus for specific target groups and an understanding of what they truly do well.

DESIGN THINKING DEFIES CONFORMITY

Insurance companies have become enslaved by the rules they created around the customer experience, distribution, and services. Holding on to these rules can only stunt improvement. Conformist wisdom gives a false sense of security — if everyone believes it, how can it not be true? Conventional wisdom revolves around the rules of the game, on leaders lacking curiosity, creativity and imagination — rules about what products should look like, pricing, communication, the customer,and the entire value chain by which these elements of a worth proposition are delivered... the industry’s sacred procedures.

DESIGN THINKING CAN BRING INSURANCE OFFERINGS TO LIFE

Insurance is essentially a construct manifested in many pages of legal jargon that not many people truly understand. This service, with little customer involvement, creates a true problem when selling the merchandise.

In an era of data overkill, sensory experiences are vital within the business buying decision. However, within the grander realm of monetary services, design is usually the forgotten discipline. Design thinking is centred on the customer and interface and may assist in bridging the gap between abstract offerings and, therefore, the real lives of consumers.

Looking beyond thew normal barriers of the insurance sector is critical for producing differentiated products and services. Direct alliance with digital platforms, distribution channels, and policyholders can unlock a number of client insights. With enough creativity, many things can be made tangible, and solutions will begin to present themselves.