The Rise of the Digital Insurance Middle Layer

The Rise of the Digital Insurance Middle Layer

Written by Roger Peverelli and Reggy de Feniks - Founders The DIA Community on 26 May, 2021

The outbreak revealed how slow the digital transformation of insurance has been to date. And it certainly pushed insurance executives to change their mindset. Covid triggered more demand for online, digital and remote services. Incumbents are retooling themselves. In this process many incumbents still show an appetite for reusing legacy assets. Which is understandable, since the legacy systems cover all current products and reusing these assets is less risky than totally replacing them. However, legacy systems also have their limitations – as we all know.

How to answer to new customer expectations
With the pandemic almost under control, it is safe to say quite a number of consumer trends that already existed shifted into a higher gear. Consequently, to remain relevant, insurers need to play at the top of the digital game, just to name one thing. Increased digital savviness, more connected cars, wearables and smarter homes result in new opportunities for e.g. embedded and connected insurance. The application of AI is becoming table stakes; to gain deeper customer insights, optimize underwriting, fine-tune pricing or pinpoint fraudulent claims, among others. At the end of the day, these are essential to deliver an outstanding customer experience - against reasonable costs.

Middleware and APIs for speed to market
So, rapidly changing customer demands require creating new value propositions and bringing them to the market more quickly, and more and more digitally. Unfortunately, legacy systems are not so good at that. Middleware platforms and APIs close the gap between fast-pace front end innovation and the stability of the backend. Over the past year, we noticed that middleware platforms are increasingly moving towards a customer facing role, especially in view of two key insights; two key drivers.

1. Contact Frequency is the Economic Engine">

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