The keys to successful digital transformation

Without proper due diligence and managing the regulatory risks effectively, the process of digital transformation can have many pitfalls. Anthony Day, partner and international head of insurtech at DLA Piper, outlines how to plan and successfully implement digital change.

The pace of digital transformation within the re/insurance industry is accelerating, bringing with it a host of new possibilities, cost savings and business opportunities. However, digital transformation also comes with challenges and, for the ill-prepared, unforeseen pitfalls. 

To successfully implement new technologies, it’s vital to understand the forces driving the change, get all your stakeholders behind it, and carry out the correct due diligence. 

Five main drivers of digital transformation within the industry

1) Consumer behaviour; 2) Improvements in technology; 3) Regulatory change; 4) Achievements through digital adoption; 5) Potential for commercialisation and cost savings

To read more about these drivers of digital transformation, click here: https://www.intelligentinsurer.com/article/the-keys-to-successful-digital-transformation

However, there are potential pitfalls to digital transformation: 

With so much incentive to embrace digital change, it is perhaps inevitable that some insurers rush to drive digital change without the right planning preparation. 

One of the most common mistakes seen by Day and his team is a “cookie-cutter” approach where a model works well in one territory, such as the US, so the organisation decides to roll it out globally.

How do you navigate legal issues?

Day adds that from a legal and regulatory perspective it’s important to look at the activities the digital transformation project is covering, and whether any of those have regulatory issues attached. If the answer is yes, you need to examine the licensing regime, who is doing what, and whether the entity doing the work needs to be authorised or rely on relevant regulatory permissions.

Focusing more closely on the regulatory aspect

Day notes that there are certain key developments to be aware of. Within Europe, there is currently an emphasis on “operational resilience”, particularly in relation to supply chain, addressing third party outsourcers or technology providers.  

Safe, intelligent use of data

As digital transformation accelerates, data ethics is becoming an increasingly hot issue, with rules enshrined by the EU General Data Protection Regulation and equivalent data protection and privacy legislation in different countries. With new AI regulations coming into play, this is an area upon which there will be increasing focus and scrutiny.

These are just snippets of Anthony Day's keys to successful digital transformation. To read the full article, click here: https://www.intelligentinsurer.com/article/the-keys-to-successful-digital-transformation.

#intelligentinsurer #dlapiper