Our recent report on IT services providers has prompted a number of discussions about the relationship between carriers and service providers. With so many options available, it can feel overwhelming for a carrier trying to make the right choice. One of the first places carriers look for inspiration is their competitors and peers.
Among those peers, we see a consistent focus on data, both in automating collection of it and analyzing it. On the data intake side, there’s a lot of interest in text ingestion and other tools for reading applications and removing the human element of data entry.
Once that data is available, the next big focus is on leveraging that data, e.g., for predictive analytics during underwriting. Carriers are inevitably faced with a seemingly endless list of point solutions and must ask themselves, “How do we decide?” The answer: look to a partner with a point solution ecosystem.
We see four types of evolving ecosystems in the insurance space:
- Some core system vendors are offering an ecosystem of integrated startups and point solutions. This type of ecosystem offering isn’t new, but the emphasis being placed on it is.
- IT services vendors are vetting and building relationships with their chosen point solution providers, equipping them to provide guidance and help an insurer make decisions on the right solutions for their specific needs.
- Some stand-alone players are trying to act as a hub that you integrate with for access to their network of integrations.
- Some horizontal solutions—like low-code/no-code and CRM players—are building their own hubs, often with a focus on horizontal point solutions.
At the heart of any of these ecosystems are the key integrations that provide value to the carrier. Ecosystems offer carriers access to those key components in a way that still allows each solution to have a specialized team behind it, leveraging economies of scale. Rather than put together an ad hoc team to build something internally, carriers can easily get access to a better solution at lower cost.
As a result of this opportunity for specialization, solution providers can build and maintain development pipelines, giving them an opportunity to be the engine for innovation in the insurance space. To learn more about the services providers currently active in the insurance industry, please read our full report IT Services Providers for Insurers: Vendor Analysis Report.