The Virtual Insurance Company Navigating Technology

Virtual companies, global competition, government regulation, the Internet, consumer attitudes...all of these are changing so rapidly, it is hard to predict what will happen in the insurance industry in the next ten months, let alone the next ten years. The decades-old Buck Rogers and World's Fairs' promises of dazzling new technologies are upon us. As we move squarely into the information age, everything we though we knew about bringing products and services to market has changed forever. In mid-1995, IBM Insurance Solutions, in conjunction with Global Business Network, a California-based firm known for its expertise in scenario planning, and twenty senior insurance executives from around the globe, peered into the future to better understand the future of the insurance industry and the role technology would play in the industry's transformation. We considered a wide range of critical uncertainties and then extracted two factors we believed were most important to the future of insurance: external controls factors that would contribute to either a constrained or a free market, and the nature of consumer demand whether consumers prefer to be active or passive in their insurance purchases. When crossed, these two axes of critical uncertainty allowed us to explore four very different and entirely plausible futures: Wired Wired World, Virtual Village, Big Brother and Back to the Future. Our hope is that this model will assist insurance companies think through and develop a set of strategic options that will shape future markets in ways that excite and delight insurance consumers as we enter the dawn of a new millenium.