INSURANCE Seven Key Trends Shaping the Future of Work in the Insurance Industry By Ben Pring and Michael Clifton The Center for the Future of Work The Work Ahead is a research series providing insight and guidance on how businesses and jobs will evolve in an economy of algorithms, automation and AI. In this installment, we look at the insurance industry. Our research shows that insurers are highly aware of the need to rethink their processes, technology foundations and business models to succeed in the digital future. Indeed, the industry itself will be nearly unrecognizable in the next decade due to digital change. Insurers that choose to move past their inherently risk-averse and change-resistant natures will reap rewards that will measure in the trillions for the entire industry, according to our research. 2| SEVEN KEY TRENDS SHAPING THE FUTURE OF WORK IN THE INSURANCE INDUSTRY THE WORK AHEAD 3 THE WORK AHEAD IN INSURANCE Long regarded as something of a sleepy backwater in the business world, the $5 trillion global insurance market is in the early stages of fundamental change that will upend business as usual. Over $1.6 trillion of new value is set to be created through the application of a digital mindset and a new generation of digital technologies in the next three years alone, according to our research. Insurance providers, traditionally averse to rocking the boat (and focused mainly on collecting insurance premiums), must rethink what they do and how they do it in the face of change driven by data, automation, arbitrage and artificial intelligence (AI). In a world of abundant data, in which wearable devices can generate individual health profiles and customized premium quotes, and auto policies can be based on actual driving performance, historical norms increasingly seem exactly that: remnants of a bygone era. Insurance companies and the executives that lead them face unprecedented challenges and opportunities as the work ahead generates a scenario in which “digital” is no longer simply a new channel to sell old stuff but is the very business itself. To understand this “digital-first” environment and the changing shape and nature of work in the insurance industry, Cognizants Center for the Future of Work surveyed 168 insurance executives across the major geographies of the world in the first quarter of 2016. We asked a range of questions covering respondents views on skills and technology priorities, the benefits and costs of digital transformation, digitizations significance to the organizations they represent, and the personal importance of digital technologies. (For more on the study methodology, see page 24.) 4| SEVEN KEY TRENDS SHAPING THE FUTURE OF WORK IN THE INSURANCE INDUSTRY THE WORK AHEAD This report is part of The Work Ahead series, which covers key topics on our digital future, including new technologies, changing business process models, and the state of digital transformation in Europe, Asia Pacific and industries such as healthcare, financial services and manufacturing. Insurance industry respondents, whose views and opinions are presented in this report, convey a strong awareness of the need to think and act differently that the norms and standard operating procedures of the past are increasingly unfit for purpose in a future of ever higher expectations for speed, transparency and ease of use. In a time when instant gratification literally cannot come fast enough, many insurance companies are teetering on technological, business process and skill set foundations that are being stressed beyond their ability to cope, let alone offer a competitive advantage. Inherently risk averse and resistant to change, insurers now find themselves facing unprecedented levels of change in their customer base, their employee ranks, the competition and the available technological tools. Insurance has been a “steady as she goes” environment for as long as anyone of working age can remember. The work ahead sees this set to change. 5 Key Findings Our top research findings can be categorized in the following seven themes, which are explored in detail in this report: The impact of digitization on the work of insurance will be profound. The insurance industry of 2025 will be quite unlike the insurance industry of 2017. The economic benefits of digitization will be extremely positive. In a three-year time span, the projected impact of digital transformation on insurers will be $1.63 trillion. Your job will change significantly by 2018. Working with AI and automation- based technology will change what humans do in the insurance workforce. The skills you need to succeed in your job will change materially as well. What got you “here” wont get you “there.” At the heart of all this change will be a new generation of technologies that you and your company need to master. The insurance industry is increasingly a technology mediated one, and the technol- ogies driving this are