Traditional life companies should see new protection entrants as potential collaborators, although this will be a big challenge, a senior spokesman for Zurich has claimed.
Peter Hamilton, head of retail propositions, said the life assurance and protection industry was facing several challenges, not least the lack of innovation and the ever-tightening grip of regulation.
However, he said another challenge was whether the industry “should see new players as potential collaborators and partners rather than automatically as competitors to be beaten back”.
He said: “In the UK we have been focused on a huge raft of regulatory change, with the seismic changes in the pensions world being the most obvious but not the only element. These changes absorb time, money and resources, but at the same time present an opportunity for new and innovative approaches to earlier and better customer engagement.”
Mr Hamilton said Zurich would adopt different approaches to developing new products, with “a greater focus on testing and learning.”
He said: “Traditional insurance product life cycles and time to market are too extended in an age where your new mobile is on its way to obsolescence as soon as you’ve taken it out of the package”, he said, adding: “Insurers will look to harness data and technology to better understand customers, to tailor products, processes and communications, and be easier.”
Deepak Jobanputra, deputy chief executive for VitalityLife, said: “As a relatively new player in the UK market we have continued to grow our market share through a range of innovations.
“We believe that to succeed it is crucial to offer new and compelling solutions that are relevant and appropriate for today’s customers.”
In September, a 44-page report from consultancy KPMG claimed that the need to innovate was already creating significant pressures on the sector.
• 83 per cent said their organisation’s future success was tied to its ability to innovate.
• 79 per cent said they were “already running” just to keep up with day-to-day requirements.
• 74 per cent said they lacked the internal core skills needed to drive innovation.
Laith Khalaf, senior analyst for Bristol-based Hargreaves Lansdown, said: “Some life companies may feel it is better going it alone, representing their own interests instead of part of a group which vaguely represents the same goals.
“In the insurance industry you have the closed life business, general insurance companies and the more progressive life and pension companies so there are a lot of competing differences and divisions in the industry.”