The Digital Insurer. The insurance industry has entered the digital age. Find out how you can stand out as a digital insurer.

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1 The Digital Insurer The insurance industry has entered the digital age. Find out how you can stand out as a digital insurer.

2 Why now is the time for digital insurance Customer needs, expectations and technology are changing at pace, putting pressure on the insurance industry to respond. These changes are presenting insurers with an opportunity to evolve, to deliver new business models and experiences that engage the consumer, preserve customer loyalty and drive profitability, which, going forward, will be key to securing customers, premiums and long-term growth. The opportunity sits right across your business. Externally, from sales and customer service to the products you provide, there is an increasing need to be personal and relevant to the current and next set of consumers. Internally, insurers are looking to exploit technology to increase their operational efficiency by digitising processes and streamlining their business. To deliver against these opportunities, insurers should be considering ways to personalise the customer experience; collaborate and understand their customers more and allow them to build closer and more profitable relationships. Personalisation is important to your customers Q: Would you be comfortable for your insurance provider to access information on your usage/behaviour in order to optimise your insurance and insurance premium, as well as offer you more personalised products? 35% 36% 32% 82% 81% 78% 47% 45% 46% 18% 19% 22% To optimise your insurance coverage To optimise your insurance premium To offer more personalised products Yes It depends on the information No Four out of five customers would be willing to provide personal information in return for certain benefits [Source: The Digital Insurer Accenture 2013 Consumer-Driven Innovation Survey]

3 Externally the demands are higher, with customers expecting new ways of interacting with their insurer, from mobile to social media all delivered with a personal touch. Running in parallel to the common pressures of business is the changing technical landscape driven and dominated by some familiar technology giants. Microsoft, Apple, and Google, along with new players like Facebook and Twitter, have between them redefined the technological landscape and customers expectations for its exploitation. Together they have moved technology into the hands of the consumer, delivering new connected mobile experiences at scale in the cloud. From cloud computing and big data to social and mobility, these organisations, along with their technology platforms and partners, have provided capabilities that deliver a whole new and exciting set of experiences and opportunities for insurers to exploit. Geo-fencing in Bing Maps coupled with GPS provides opportunities to tailor insurance like offering singletrip insurance To be capable of responding to and taking advantage of these opportunities, insurers should be looking to reevaluate their platforms and understand how technology can support new product and distribution strategies. The insurers that succeed in exploiting this new world will thrive, whereas those that fail to absorb the impact and transform may well stagnate as more agile, innovative and relevant competitors emerge. The rest of this paper describes some of the business innovations, technologies and opportunities that insurers can take advantage of, and how Avanade can support insurers on their digital journey.

4 The digital insurer In an increasingly competitive landscape, dominated by consumer technology, insurers have the opportunity to develop new business and distribution models that will see fresh products and services emerge -- all more aligned to the customers needs. Q: How important would a personalised service be in your decision to stop doing business with your current provider or switch to another in the next 12 months? The application of technology will allow insurers to remodel all aspects of their business, from their product offerings to sales, marketing and service operations. Key to this will be linking the benefits of building personal, value-added services and intimate relationships together with increased product ownership, retention and profitability. In addition to personalisation, the digital insurer will have the opportunity to launch a completely new set of experiences and products that deliver competitive propositions focused on addressing the changing expectations of the customer. 30% 50% 80% For example, consider a connected health monitor. A monitor capable of identifying potential health risks in real-time, alerting the user to take action before claims occurs. Or a motor claims process that allows reconstruction of an accident scene via sensors in the driver s smartphone or car, allowing a more accurate assessment of the cause. These examples and others illustrate how the digital insurer is capable of delivering more specific and potentially cheaper products. To deliver against this potential requires a flexible multichannel communications and distribution architecture. An architecture that is capable of linking flexible product platforms with an intelligent customer management and data layer that can deliver personalised products, sales, marketing and service to the customer over a variety of channels, one that is capable of managing unprecedented volumes of data. 14% 6% Very important Somewhat important Not very important Not important at all Indicators suggest that personalised service is key in buying/retention decisions [Source: The Digital Insurer Accenture 2013 Consumer-Driven Innovation Survey] Social Analytics & Insights rd 3 parties Underwriting Rating Engine Digital Advanced Marketing Collabration Policies Billing Contact Centre Sales Reinsurance Claims Multi-channel communications and distribution channels Intelligent customer management Flexible Product Platforms Logical Digital Insurer Architecture

5 Delivering digital insurance As previously described, the digital insurer should be looking to exploit the agility and flexibility in its channels, distribution, customer management, analysis and product platforms. Once integrated, these requirements enable a joined up experience for the customer, providing a platform from which more profitable and accurate decisions can be made by the insurer. This next section describes the core aspects of these platforms and the capabilities they can deliver. New experiences: Multi-channel communication & distribution In the new digital world, customers are looking to purchase products over a range of channels, from mobile to social and beyond. By providing this in a holistic way organisations have the opportunity to develop closer relationships with their customers. Organisations adopting social media services such as Twitter or Facebook to deliver marketing messages and service to customers, coupled with sentiment analysis, allows them to develop more insight and opportunity for sales through closer customer relationships. The rise of tablets and smartphones provides the opportunity to deliver new solutions for both consumers and providers, which will only increase as the internet of things becomes mainstream. With common features like touch-based interfaces, augmented reality, HD cameras and GPS, new opportunities are emerging that a digital insurer can use. For example, telematics applications using the sensors in a phone can assess driving performance and offer discounts, whilst personal fitness apps can add a degree of gamification and provide invaluable data to underwrite risks. By using this data insurers have the opportunity to develop new products that can be underwritten on a more granular basis, paving the way for lower premiums or discounts. Finally, with the rise in new insurance models, such as small-ticket insurance, new models for sales and servicing are emerging. By using technologies like Windows Phone, Windows Embedded or even Kinect for Windows, insurers can deliver new apps capable of assessing health, identifying house content and providing new sales channels that could reduce losses and increase revenue. Mobile devices (e.g. smartphone, tablet) Social media 35% 58% 59% 67% Online direct Digital agencies (e.g. online representation of physical channels) 27% 46% 46% 75% Retailers and other non-insurance partners Online through aggregators None of the above services 4% 4% 31% 37% 30% 40% Considering developing in the next 3 years Currently developing Future priorities: New sales and distribution channels to be developed over the next three years [Source: Accenture 2013 Digital Insurance Survey]

6 New mobile devices are not only applicable for the customers, they can also benefit your operations. From providing customer-facing insurance advisors with information where and when they need it to enabling data insight on-the-go for executives, you can aid overall productivity and conversion rates. By equipping agents with secure, enterprise-capable tablet devices linked to customer management systems, closer relationships can be developed through a more personal and targeted customer service offer. Avanade s Insurance Advisors Solution integrated with Dynamics CRM and delivered onto the next generation of tablet devices. Intelligent customer management The ability to understand and make intelligent decisions quickly and accurately about the products and services that customers need: these are the key differentiators for digital organisations. By exploiting new computing models (such as cloud), organisations now have the opportunity to mine and infer trends at speed, allowing them to make decisions that drive profit and reduce losses before the competition can react. Consequently the digital insurer is looking to exploit data; combining public and private data to make intelligent decisions with accuracy and speed. Using products such as Microsoft s Dynamics CRM, Avanade delivers solutions that provide a single view of the customer, not just in terms of their product holdings but in the interactions they have with the insurer. By linking this with social networking activity and policy administration platforms, insurers have the capability to build up a complete view of their customer s position, needs and aspirations therefore identifying potential development opportunities rather than having to cope with the incomplete view formed by the disparate, unconnected platforms that exist across many insurers today. For example, today it is possible to combine limited data provided by the customer, such as a postcode, with publicly available data like land registry information to provide rapid quotes for house insurance accelerating and simplifying the buying process. Outlook Browser Mobile Role-tailored Marketing, Sales & Services Portable/ Custom UI The intelligent customer platform provides this capability, acting as the link between the distribution and communication channels and the core product platforms. Specifically it is used to provide a single view of the customer, both operationally and analytically, providing a platform to manage customer marketing, sales, communication and product portfolio decisions. It allows the insurer to develop the complete picture of the customer required to support more personalised relationships. Legacy CRM Integration Hubs Configurable Business Processes Point & click Customisation Legacy Data Application Metadata 360 Customer View Workflow & Events Legacy Applications Extensible Data Model Service-Oriented Architecture Real-Time Integration ecommerce ERP Data Warehouse Microsoft s Dynamics CRM provides a core customer platform. Operating as the hub of the digital insurer, it links the distribution channels to the core product platforms and decisioning engines.

7 Data deluge In addition to managing customer data, digital insurers will need to process ever increasing volumes of externally generated data, from black boxes in cars to health sensors Masternaut, a European telematics provider, who tracks and monitors drivers, vehicles and mobile assets across Europe, process, analyse and store around 150 million data transactions every day. and beyond, meaning there is a need for a different scale of data processing capability. Avanade s cloud-based analytics platform is one such example of how digital insurers like you can deliver a service capable of supporting these new data volumes as your data and business intelligence needs grow. This model allows insurers to move from capital to operational cost models, paying for what they use rather than building large infrastructure environments that are often left underutilised for much of their serviceable life. Big Data: powerful analytics and visualisations give insurers real-time access to information to make more informed decisions. Using tools like Excel Powermap it is possible to map public data, device data, internal data and location data across a time series to spot trends and support better decisioning, for example to identify accident hotspots Delivering innovative products with flexible product platforms A key issue for many insurers is the fact that legacy systems were not designed to support these emerging requirements. Legacy systems are typically difficult to integrate into a modern environment and this results in long, complex and expensive programmes. To drive profitable premium growth, digital insurers need newer, more flexible, modular and agile product administration solutions. Modern product platforms enable codeless configuration of product definitions, empowering the business by reducing the dependency on IT delivery schedules. They make data more accessible through advanced BI and analytics capabilities; they foster operational excellence by streamlining processes, effectively providing the right tools for the right actor, whether it s an employee, an agent, or a broker. Modern platforms also deliver increased performance, supporting the volumes created by the channels (such as aggregators). A modern platform, like Accenture Duck Creek Policy built on Microsoft technologies, enables both a larger offering of new, personalised, configurable products and an agile product development lifecycle. No matter the type of product, insurers can go to market quickly with innovative products. Modern platforms are architected around the paradigm of codeless configuration deployments, and are able to support multiple lines of business and any sales channel, whether direct, agent, or partner. Accenture Duck Creek has been designed with the needs of the digital insurer in mind.

8 Summary: Delivering digital insurance today To deliver the next generation of insurance business models, enterprise organisations need platforms that are capable of delivering flexible products and pricing. This must be coupled with a customer-centric model that uses up-to-date analytics to drive the user experience, servicing and product definitions required by the next (and current) generation of consumers. At Avanade, and with Microsoft and Accenture, we total over 60 years of experience in delivering solutions into this market using innovative technologies to deliver core and differentiated propositions. By using technologies such as Microsoft Dynamics CRM, Windows Azure, SiteCore, and Windows Phone 8, Avanade is capable of delivering new user experiences that will transform the way customers interact with their insurer. When coupled with big data analytics technologies such as HDInsight Hadoop on Windows Azure and nextgeneration product platforms like Accenture Duck Creek, we can deliver an end-to-end architecture that will serve insurers for the foreseeable future. rd 3 parties Social Analytics & Insights Digital o 360 Advanced View Customers Marketing& Prospects Collabration Sales The Digital Insurer Platform

9 How Avanade can help Avanade provides consultancy and delivery for bespoke and managed service solutions. Through our work with some of the world s leading insurers and financial services organisations we have built up specialist knowledge and assets that can be applied to all kinds of digital insurance initiatives. Whether it s delivering an advisor application across mobile platforms, a new CRM system linked to existing line of business applications, or new cloud-based models and managed services for policy administration, claims, digital marketing or analytics, Avanade has the skills to deliver. Talk to us today about how we can help you deliver the next generation of digital insurance firm. Contact us today Avanade has plenty of experience helping enterprises and financial services organisations plan and implement cloud strategies. We ve already helped financial services companies like Aviva, RSA and National Australia Bank make better use of their technology we d love you to join them Who we ve worked with Call, or tweet us About Avanade Avanade provides business technology solutions and managed services that connect insight, innovation and expertise in Microsoft technologies to help customers realize results. Our people have helped thousands of organizations in all industries improve business agility, employee productivity and customer loyalty. Additional information can be found at com Avanade Inc. All rights reserved. The Avanade name and logo are registered trademarks in the US and other countries. North America Seattle Phone America@avanade.com South America Sao Paulo Phone +55 (11) latinamerica@avanade.com Africa Pretoria Phone SouthAfrica@avanade.com Asia Pacific Singapore Phone AsiaPac@avanade.com Europe London Phone Europe@avanade.com