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Mobile insurance case - Germany - Digital business model

Someone asked on Nov 17, 2017 - 1 answer

The client is a large European insurance services provider for businesses and individuals. They would like to launch a new mobile insurer in Europe for standard non-life insurance products, like car or home insurance, by maximizing the use of direct and instant customer interaction via an app on their mobile devices.

The client is interested in taking a greenfield approach, seeking to attract digital customer segments through the application of new technologies –telematics, big data/analytics, IoT, etc. –as a mobile insurer. They expect our consultancy firm to share the risk by co-investing in the new company that would be built as a result of this project. The timeline of the project is two phases of 7 weeks each.

In an upcoming board presentation, the executive board is looking to understand the value potential of digital and their possibilities to launch a mobile insurance.

I am thinking of those questions:

Why is now the right time for the client to use business building as a growth innovation engine?

What kind of mobile insurance can you imagine for them to launch?

Which competitors should they keep an eye out for?

Who are some potential partners/what sort of ecosystem could be required for success?

What is the market potential in Germany? [Please help me out for this calculations].

What kind of business models can you imagine for the mobile insurance?

What other possibilities do you see to disrupt the insurance value chain and create value through digital?

Why is our consultancy firm the right partner for the success of this project?

Client goals: Convenience, accessibility, connectivity, customer experience, data collection, use of new technologies

I would be very grateful if you guys can help me out structure the case and brainstorm/help me out solve it.

Thank you so much! Really looking forward to hearing your thoughts. Please share with me if you saw similar cases treating with new actual content (disruption, digital business models, user experience).


updated his answer on Nov 17, 2017
ex Manager Bain and A.T. Kearney / 200+ real interviews

Hi Anonymous A,

From my understanding, you want to answer this question: is there a potential to launch a mobile/digital brand in Europe for P&C (property & casualty) insurance? If so, what are the key attention points to assess?

My hypothesis is that insurers can use digital tools to deliver added value services, lower premiums and an overall better customer experience (hence firms that do this well will reduce costs and raise revenues).

You will find below how I would structure the key questions (and a few ideas on interesting points to assess):

  • Customer
    • What are the key customer segments? (size, growth rate, trends,...)
    • What is the favoured distribution channel per segment?
    • What is the level of expertise required to serve each segment? (e.g. car insurance is much more standardized than industrial insurance)
    • What are the most relevant segments for your Client? (could be ranked by segment attractiveness vs. R&D investment ratio for instance)
    • ...
  • Product
    • What is the current market saturation by product vertical? By European country?
    • What additional verticals could be targeted? Are there any specific tools & capabilities to conquer such verticals?
    • ...
  • Your Client (I would approach this by looking at each step of the insurance value chain)
    1. Product design
      • What is the impact of new expert figures (e.g. Data Scientist) in the new digital insurance era? What are the new forms of data science that will rise to the forefront of the modern insurance firm (e.g. IoT data , historical data for predictive analytics, location awareness for risk mitigation,...)
      • What are the required additional capabilities? Develop internally or buy externally?
      • ...
    2. Pricing and underwriting
      • How to minimize fraud online? What is the right anti-fraud technology to sell online?
      • What are the key value propositions and what are the mutual links between them (cross-sell, up-sell, …)?
      • ...
    3. Distribution
      • What are the key purchasing criteria for insurance products? How does offline compare to online?
      • What are the required skills and organization to accelerate growth online? How to attract the best digital talents?
      • What is the risk that existing distribution partners (e.g. Carrefour) develop insurance products internally?
      • What are the possible impacts of selling online in terms of cannibalization of existing sales?
      • What are the organizational and legal constraints to sell across European countries? (e.g. different legal requisites, multilingual product, multilingual support,…)
      • ...
    4. Admin and claims management
      • By how much will predictive technology improve performance?
      • ...
    5. Additional links upstream/downstream
      • Is there any new function along the value chain created by Digital?
      • ...
  • Competition
    • What strategy has been adopted by competitors? And in other European geographies?
    • How does Client brand image compare to its competitors?
    • What are the risks and threats from GAFA and new entrants (online pure players)
    • ...

I hope this helps. Feel free to reach me for any additional info.


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