Historically, the insurance world’s value chain hierarchy was Carriers develop products and captive or independent advisors, distribute it. With Insurtechs, online options and rate aggregators, the lines have blurred. Initially, the debate was: Is Insurtech an insurer with technology approaches or a technology company supporting insurers? The definition settled on tech companies selling to insurers; however, the debate now adds the latest trend: technology companies owning and distributing insurance.
The paradigm shift began with brokerages, challenged with distributing their digital solutions on a wide scale, facing gaps in scalable technology and single-entry, multi-carrier interfaces. Brokerages merged and outgrew their suppliers. Now they dictate products, commissions, and even white-labeling solutions to assume ownership of the marketing of insurance products.
With Aon-Willis Towers Watson merging, new mega-brokerages will have unprecedented opportunities to scale their businesses as they market themselves as a one-stop-shop not only for brokers but for policyholders and true digital capabilities. They demand solutions from product and service providers for the solutions needed to scale.
The original version of this article was published in PC360. To view it, click here.