Gartner Research

Why Most Insurtechs Will Fail and How Insurance CIOs Can Take Advantage of That

Published: 13 June 2017

ID: G00327952

Analyst(s): Juergen Weiss

Summary

Almost $6 billion has been invested globally in insurance startups in the last five years, but expectations about their disruptive potential are often exaggerated. CIOs should not be passive; insurtech failures present opportunities to complement their innovation and digitalization strategies.

Table Of Contents
  • Impacts

Analysis

Impacts and Recommendations

  • The insurtechs' focus on customer experience doesn't generate new market demand, but it can complement the digital strategies of insurance CIOs
  • Customer inertia will undermine the value proposition of many insurtechs, but insurance CIOs can create a sandbox environment for prototyping and experimentation
  • Most insurtechs underestimate the costs needed to penetrate markets, which will create investment opportunities for insurance CIOs

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