The total annual value of property and casualty (P&C) and life insurance policies sold through digital channels in Europe is expected to touch €25bn in 2016, which is more than twice the 2012 volume of €12bn.
A new study by Accenture based on a survey of 78 insurers across Europe, underlines that policies marketed through digital channels are expected to account for 18% of European insurers’ total annual new business premium volume in 2016, against 11% in 2013.
The report points out that nearly three-quarters or 78% of European insurers are considering to boost investments in the digital transformation of their sales and distribution functions, and expect to spend €27m, on average, in this area over the next three years.
Accenture Distribution and Marketing Services global managing director Piercarlo Gera said that the shift to digital is inevitable for insurers and our study reveals that the industry is investing heavily to transform itself.
"This transformation is critical to attract consumers who are becoming increasingly unwilling to buy a product or service that does not provide the same levels of convenience, simplicity and speed to which they have become accustomed from many other services they use every day.
"Insurers must invest in capabilities with a clear strategy to improve the overall customer experience with every interaction," Gera added.
In the survey, 85% insurers said that the complexities of managing changes across physical channels is the most important challenge in Europe, nearly 81% said that the digital transformation of their distribution as well as inability of their organization to act quickly is a problem.
Over the next three years, the competition in the insurance distribution market is expected to intensify, as indicated by nine European insurers out of ten, who participated in the study.
About two-thirds (64%) anticipates that this competition will come from non-insurance players, including Google, or e-commerce giants like Amazon.