Briefing: The three crucial questions that lead to successful innovation

By Content Director Saxon East

Awards season is already upon us. The entries are in for the Insurance Times Claims Excellence Awards 2021, with the awards scheduled to take place virtually on 27 May.

Having been a judge on numerous awards over the years as well as generally covering innovation for Insurance Times, it is a good time to reflect. 

It strikes me that the same three questions come up over and over again.

The questions are: 

So simple, right? But actually, as a journalist and judge, I’ve discovered that businesses can struggle to answer these questions convincingly, especially ambitious new insurtechs. 

Staff can also widely disagree on their answers. 

Let’s look at some examples. 

When thinking of Trov, did it ever actually solve a problem? On demand insurance sounds appealing - you can use mobile technology to quickly get insurance for items. 

But Trov didn’t solve a problem. A high proportion of customers in personal lines want to interact less, not more, with insurance.

When they do interact, it is often (but not always) about saving money.

That is why GoCompare’s Weflip is growing customers quickly. 

Despite the regulator’s focus on value, any insurance firm in mass market personal lines is on to a winner if they can get people to interact less and pay less. 

Other examples of problem solved include Comparethemarket’s free meerkat teddy. Sounds a cheap way to get people to purchase insurance, but it brilliantly solved a problem for me in keeping my daughter happy when I handed over Oleg. 

Her eyes lit up with happiness. 

Getting payment

Now let’s move to cyber and the ‘why will they pay for it?’.

Although the tide is turning of late, certain insurers and brokers struggle to sell mid-market and SME cyber. 

Cyber solves a problem, but businesses are not willing to pay for it. Was it the brokers not selling cyber properly? Firms trying to save money? 

Then there is the question of who exactly is your customer. Let’s look at large brokers with branch networks that subsequently invest in SME call centres to deal with sub £5,000 premiums. 

It’s more efficient, we are told. 

But who exactly are the small businesses that prefer a call centre? Who are the ones that do not?

It is difficult to understand, so the model comes with huge risks.

The ones that prefer the more personal touch will leave quickly - as the old Towergate discovered. 

Opportunity second

One more point, people always talk about ‘opportunity’.

But you get more clarity if you ask first about solving the problem and then the opportunity is around how the successful problem-solving innovation or product can be scaled.

Problem first, opportunity second. 

In summary, those are a quick few thoughts for those entering our awards, or anyone looking for a ’quick and dirty’ innovation test.  Ask the questions and you might find yourself as surprised as me at some of the answers.