News Release

September 12, 2017

‘Open architecture innovation’ will drive new growth for insurers, according to Aon GIMO report

On-demand economy highlighted as key area of opportunity for traditional industry

MONTE CARLO, September 10, 2017 – Aon plc (NYSE:AON), the leading global professional services firm providing a broad range of risk, retirement and health solutions, today launches its annual Global Insurance Market Opportunities (GIMO) report, which examines key areas of potential growth for insurers.

The study highlights that Insurtech could be an enabler rather than a disruptor of the traditional insurance model. The fast-growing entrepreneurial Insurtech segment – that has secured approximately USD14bn in investments to date across more than 550 start-ups globally – may have a more supportive role for insurers than previously thought via ‘open architecture innovation’. Established organizations play an important role in open architecture innovation, by collaborating in a framework which has both standards that enable scalable solutions for clients and the flexibility that encourages entrepreneurial innovation.

The report reveals that three of the leading areas where analytics can help with insurance industry growth – cyber risk, casualty catastrophe risk, and pathogen risk – could become increasingly insurable through collaborations with Insurtech companies, and technology and analytics providers, thereby opening up new opportunities for insurers and reinsurers to provide new and enhanced products.

Meanwhile, the on-demand economy (ODE) is presenting both opportunity and disruption to the traditional insurance sector, through the requirement for a greater range of time-based insurance products that recognize that assets such as cars and homes are increasingly used on both a commercial and personal basis – driven by the increasing utilization of services such as Uber and Airbnb.

In terms of disruption, the report highlights that US motor pure premiums could decrease by more than 40 percent of their 2015 levels by 2050 – the point at which autonomous vehicles are expected to be fully adopted. However, while accident frequency is anticipated to reduce as a result of driverless technology, the study warns that accident severity could increase and that a transfer of liability could occur, from drivers to car manufacturers and software providers.

Paul Mang, Aon’s Global CEO of Analytics, said: “We know that the insurance sector is facing challenges in the current macroeconomic environment; so we should expect leading organizations in the industry to drive change. We are already using technology to make us more efficient as a sector, and to expand into emerging risk markets. However, the true transformation will happen as we re-imagine risk management altogether. In this new environment, collaborations, or what we call open architecture innovation, will be key to creating net new growth.”

The 2017 GIMO report contains extensive analyses of the cyber sector; it reveals that the handling of cyber risk is moving beyond traditional insurance, and that a typical cyber insurance policy should now offer access to a panel of service providers for incident response and additional services. These services – whether offered by a carrier directly or through partnerships – will provide insurers with a way to broaden their value proposition beyond the traditional insurance policy.

The report can be found at the following link: http://aon.io/2vMRrBC

About Aon
Aon plc (NYSE:AON) is a leading global professional services firm providing a broad range of risk, retirement and health solutions. Our 50,000 colleagues in 120 countries empower results for clients by using proprietary data and analytics to deliver insights that reduce volatility and improve performance.
About Aon South AfricaAon South Africa is a leading provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Aon Empowers Results through over 700 colleagues in 13 offices in South Africa with its head office in Sandton, Johannesburg

Tags:

Aon welcomes relevant dialogue and commentary on our thought leadership materials posted to our website. However, we reserve the right to delete any content that is harmful, obscene, or spam before it is published to the site.

If you elect to comment or engage with our content via third-party social media websites, you authorize Aon to have access to certain social media profile information. Please click here to learn more about information that may be collected when using these tools on Aon.co.za

All Comments(570)

Open for comments. Sign in or create your Aon South Africa account to join the discussion.
Tom Hatcher 7 Jun 2014 14:58 Comments Policy
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Sed luctus nulla ac sem viverra, quis adipiscing lectus elementum. Fusce semper bibendum pellentesque.
Sandy Smith 25 May 2014 11:44 Comments Policy
Lorem ipsum dolor et al.
John Smith 12 May 2014 17:09 Comments Policy
Lorem ipsum dolor et al. Lorem ipsum dolor et al. Lorem ipsum dolor et al.
Show all comments...
Previous 1 2 3 4 5 Next

Quick Forms

Contact Me
Compliments & Complaints

Twitter Feed