I'm a big fan of summer -OS. And despite some long-standing difficulties caused by COVID, it's great to see the games played again after being delayed by a year. It is another part of the world's slow and sometimes uncertain return to normal. It is a chance for thousands of strongly driven and committed athletes to showcase their talents, market their country and thrill millions of spectators around the world.
Two observations about Olympic competition really stand out in my mind. First of all, it's amazing to see how these talented athletes can make extremely difficult and sometimes complex feats look graceful and simple – like the amazing Simone Biles who is a miracle! And for most, their event lasts only a short time (the men's 1
These two Olympic observations have interesting parallels with insurance. The first highlights a similarity between the two: insurance is a complex product and often difficult to buy or understand, but the best companies – both established and start-ups – push for gold by making it simple and easy for their customers.
The second observation highlights a major difference. While the "gold medal group" for the best companies can be considered to have "photo finishes" with each other, when the whole area of insurance competitors is taken into account, the gaps between the gold, silver and bronze colors are alarmingly large. And with the pace of change in technology, new channels and players, and changing customer demographics, behaviors and expectations (all accelerated by COVID), companies in the bronze medal group can quickly move from competitor to spectator in future "Olympic insurance games."
Some competitions are not even close
We have tracked an insurance version of gold, silver and bronze medalists with the Leaders, Followers and Laggards segments in our annual research on strategic priorities, based on insurers' prospects and expectations for their companies over the next three years. based on their responses to plans for new products, channels, business models and other strategic issues.As shown in Figure 1, the leaders significantly exceed the other two segments, with gaps of 102% and 28% respectively between Laggards and Followers respectively
Figure 1: Gap between Leaders, Followers and Laggards segments
2019, AM Best also started tracking winners in insurance b the team's innovation game and issued its first report in March 2020. In AM Best's innovation assessment, a company can receive a maximum score of 16 in each of two innovation components, inputs (with 4 sub-components: leadership, culture, resources, processes and structure) and results (with two double-weighted sub-components: result and transformation level); a top rating in both categories would give a maximum score of 32.
AM Best created five innovation categories with predefined score ranges, allowing them to compare scores across industries and track changes in score distributions over time. Insurance Journal summarized the results of the 2020 and 2021 assessments and highlighted reinsurance companies with the highest innovation scores, but also an overall downward change from year to year in percentage of outstanding and leadership results, from 10% to 7%. [i]  Figure 2: AM best innovation evaluation results
Since the Olympics awarded only three levels of medals, I collapsed the five AM best categories into three, which also correlates them with the leaders, followers and laggards of our strategic priority research:  Minimal (Laggards, bronze): <12 points
Interesting, the gaps between these score intervals, the gaps between the team guards and the followers are very similar compared to the leaders, as seen above.
So, from two different reviews and methods, we see remarkably similar conclusions about the gaps in performance of the "sports insurance companies" in insurance OS. It is about like two different TV networks that cover the Olympics but report the same results from slightly different points of view.
Figure 3: AM Best Innovation Category Score Ranges & Gaps
Before going into the results of individual "events" covered by strategic priorities, we asked companies to assess their performance and level of strategic activities during the previous year. The gap between Leaders and Laggards was the largest we have ever seen, more than doubled in size in three years! However, the gap between leaders and followers has slowly narrowed. Laggard's gap with both leaders and followers reflects a strong reality of their lack of awareness, planning and implementation that reduces their relevance and puts their future at increasing risk.
When looking at the individual events where leaders win, they are solid gold medalists in all but one of these events, and connect with followers to integrate platform technology.
Figure 4: Gaps between leaders and laggards, followers
Training Secrets of Future Winners
For insurance companies to win today and in the future, improving their digital capabilities is key. But simply adding different digital portals or individual features like digital payments will not diminish it. Becoming a digital insurer requires a cultural change and change of mind to a new way of thinking, planning and doing. Leaders know this. Leaders do this.
They use digital technology to improve customer and employee experiences and to improve their strategic and operational capabilities. In these new "digital events", leaders loudly beat the legal guards in Digital employees' benefits on board and commitment (28%), Intelligent digital requirements (22%) Innovative, personal products (43%), Intelligent digital marketing (48%) and segmentation (61%) and Digital assets for reporting, modeling or compliance (35% ).
Today's customers are increasingly digitally skilled, with higher expectations, different needs and demands for better experiences that are not met with the "traditional" insurance method, which creates a fault line between customers 'expectations and insurers' ability to deliver. These digital gaps will be the new competitive differentiators.
Figure 5: Leaders, followers and laggards' response to developing / implementing digital capacity
Climbing the podium
There are interesting parallels between Olympic athletes and insurance companies. But while Olympic athletes have to test all their hard work every four years, insurance companies have to do it every day without giving up. And they are faced with new startups and new players outside the industry — challenge them in their own game with new, improved digital opportunities that raise the bar.
Is your company fit enough to win both today and in the future? Do you go for the gold? Read the report Strategic priorities for developing your Olympic-caliber training plan!
[i] Sclafane, Susanne, "Carriers Struggle To Transform Innovation Efforts In Results: AM Best", Insurance Journal, 11 May 2021, https: //www.insurancejournal .com / news / national / 2021/05/11/613401. htm