Insurance contracts via app

The exception (for now)

For the insurance industry, it will be more and more important in the near future to offer customers the option of choosing products with an app. A survey from the industry association Bitkom suggests this.

One result from the Bitkom survey indicates that until now, only a minority of people living in Germany have taken out an insurance using an app. Only 5 percent of those surveyed have had experience with this. The industry association conducted a telephone survey regarding this topic with around 1,000 Germans.

Cooperation with InsurTechs as a chance for faster success

Not all insurance companies would currently be able to present such offers on mobile devices. Obstacles to the development of such innovations are often outdated IT systems and no longer up-to-date development cycles, connected with a cost pressure that sets tight budget restrictions and little space for new product approaches.

A whole row of startups recognized this, as they make mobile devices the central platform for their product ideas without consideration of technological burdens. The many different contract managers and simple product offers from the past years prove the innovative spirit of the young companies.

For example, the creators of "Getsafe" are planning the development of a variety of independent offers and started with a digital legal protection insurance.

Experiences from the past years show that many InsurTechs had to change their business model, because the acceptance among customers did not correspond to the business plans. For traditional insurance companies, it still appears to be a good idea to form cooperations in this area. The insurance company provides their existing customers as well as their established market access, while an InsurTech provides agile development methods as well as mobile technologies and, at the very least, innovative ideas for accessing young generations.

Insurance expert Nadler confirms: "It is not just about the classic completion of a policy, but rather in particular innovative offers such as on-demand insurances that make room for new business models."

Both sides can profit from such a cooperation. However, many insurance companies have enough tasks to master in light of a current cooperation. Combining procedural models and technologies from a startup with the insurance technology of the company can be challenging. The intensive use of the cloud and the use of defined APIs, as is typically the case for young companies, do not yet harmonize with every insurance company. Silo thinking, outdated systems without interfaces as well as shadow IT in the shareholders inhibit the exchange of data and therefore a cooperation with InsurTechs, ultimately meaning the innovative power.

The numbers from Bitkom show that insurance companies should not waste any more time with regard to this topic, otherwise they may lose touch. Now it is time to rethink IT strategies and free yourself from burdens.