”Think big, start small, scale fast” – A practical example
Baloise is a Swiss insurer that traditionally relied heavily on an agent led distribution model, with their 700 tied agents selling a range of P&C and life products across the country. That model worked well for them, but in late 2016 they wanted to embark on a journey of digital transformation to grow its customer base.
Traditional strategies for implementing large scale projects within insurers tend to be slow and costly. Months of research, business modelling and planning culminates in huge bets on complex projects delivered through a waterfall methodology where results can only be measured years down the line.
During an introductory meeting between Philipp Marty, then Baloise’s head of home and liability personal lines (now head of new business and partnerships) and KASKO, Baloise soon realised that KASKO’s insurance platform, with its core focus on product configuration and distribution, might be the perfect tool to realising some of the many new product ideas that Baloise had, but didn’t have IT capacity to pursue, not the least due to a multi-year core system transformation that was and still is underway. Key to the success was the realisation that this “digitalisation” could actually rely on and complement the existing distribution channels, while important internal IT work to modernise and re- platform core systems, did not have to be reprioritised.
Philipp had discretion to sign off a number of small POC projects, which had a capped budget. In the space of a few weeks in early 2017 KASKO built and Baloise launched three single item insurance products on Baloise’s website (smartphone, bike, TV). The key was that they were simple products that were quick to deliver and could start attracting new business right away and more importantly acted as a proof point internally and externally that it was actually feasible to launch products this fast. This was followed by the first photo-AI powered watch insurance in Europe just 2 months later. This product (or rather the AI component) was less about driving volume, but attracting media publicity and thus positioning Baloise as an innovative partner towards its potential distribution partners, which it did (and being voted most innovative Insurance company in Switzerland in that year, a first time in Baloise’s history, also didn’t hurt).
The profitability and publicity of these pilot products secured further budget and by 2018, KASKO created a multi-item framework for Baloise (>100 items, various risk categories, coverage types, durations etc.), which included a flexible front-end purchase journey, that could be integrated into any point of sale (POS). This in turn enabled Baloise’s agents to onboard more than 700 offline retailers 3 months post launch. To date, this programme generates high-triple digit new policy sales a week in Switzerland, the majority of which are first-time customers.
The key is not to reduce ambitions, but to switch tactics from a single big bet to a portfolio of small ones. The aim is to achieve measurable results quickly rather than getting drawn into long-term hypotheses.
Are you facing challenges around digitalisation, new product innovation or reaching new distribution channels? Are IT resources limited or tied up in other projects?