General insurance in the age of digitalisation, innovation and blurring industry lines

By Jonathan Thun


With COVID-19 and exciting start-ups accelerating rapid digital evolution, traditional general insurance firms are investing heavily and transforming to keep up. PA financial services experts Frode Lervik and Jonathan Thun interviewed Gjensidige’s Executive Vice President of Private Norway, René Fløystøl, about how the Nordic general insurer is prioritising and innovating to continue to be customers’ insurer of choice.

First, what are Gjensidige’s most important strategic objectives in the coming years, and how does innovation fit into that narrative?

Fløystøl: Gjensidige wants to solve real problems for our customers by securing their health and valuables, something which we offer through our core products; home, life and auto insurance. This will continue to be our focus but we believe we can increase the value we create for our customers by supporting them more in preventing adverse events. So, we will increase our focus on prevention.

To achieve this, we need to assume a more important role in our customers’ daily lives, increasing the number of customer touchpoints and expanding the breadth and depth of services we provide to our customers. We are accelerating our transformation into a technology and data-driven business, changing the way we operate, the technologies we use and the people we recruit to achieve this. This is an exciting journey to be a part of.

Why are you making this change now?

Fløystøl: Maintaining a strong, ongoing relationship between customer and insurer is becoming increasingly important, and Gjensidige works purposefully to increase customer satisfaction. We are proud to be number one in BI’s (Norwegian Business School’s) customer barometer for general insurance companies in 2021. We are also sixth across all industries on Ipsos’ reputation survey, something we are perhaps even more proud of, considering the companies that are ahead of us.

Looking ahead, increasing the number of contact points and thus the quality and quantity of data will be increasingly critical to enable us to continuously improve and maintain this position.

You mentioned increasing contact points – why has this become an important measure for you?

Fløystøl: We see that companies in adjacent and other industries are expanding the scope of their services to their customers, improving the customer experience and simplifying the customer journeys. Car manufacturers provide auto insurance through their own brands, and marketplaces are offering insurance directly through their portals at point of sale. The traditional lines between industries are getting blurred.

There are many drivers behind this, but one key aspect is the wish to own the customer relationship or get closer to the customer. This has led to new and changed roles in the insurance and related ecosystems that we are typically a part of and interact with. Gjensidige’s ambition is to take an active role in shaping and orchestrating these ecosystems.

Which ecosystems does your business primarily engage with?

Fløystøl: We are working primarily with three ecosystems closely related to our most important products – mobility, housing and health. We can already see ecosystems are beginning to materialise within these verticals.

We have already made a commitment in the mobility vertical through Gjensidige Mobility Group. This part has deliberately been set up as a new business entity which is separate from our core activities. It is responsible for driving business development in mobility and the investments in Falck, Flyt and Lettlånt are all investments that will be further developed within this new entity.

In terms of housing, we are looking into Loss Preventions as-a-Service (LPaaS). The vision is to manage safe housing for Norwegians and use the existing claims assessment organisation and value chain beyond just settling claims for damage that has already occurred. This builds on our desire to work more closely with our customers to be more preventive in the future.

Within health we are always looking for ways to improve our customers’ lives. Our collaboration with Lifekeys Online psychologists is an example of this – we now offer video conversations with certified psychologists through our health insurance, without any additional cost. In the future, we must find the areas where we can play a role in the short-term to prioritise and focus harder in the long-term.

What makes Gjensidige a better orchestrator than other companies?

Fløystøl: We have three key building blocks that put us in a very good position to succeed; a large customer base, very strong analytical expertise and available capital for investments. Furthermore, I strongly believe we have exciting opportunities and a strong proposition to offer, so we can develop our people and attract the talent required to succeed.

This will put quite a strain on your innovation capabilities and budgets, will it not?

Fløystøl: Gjensidige understands that to succeed with innovation, the key is our ability to implement. We therefore hire new people with the right capabilities and free up capital for investments by implementing new ways of working and more effective operating models. We have invested heavily in digitalisation – which has been very cost-effective, while at the same time enabling significantly better customer journeys, for example in our claims processes.

Together with the power of the Gjensidige Lab, our innovation centre, this puts us in a very good position to bring innovations and better customer experiences to the market.

How do you decide on new areas to venture into?

Fløystøl: If we are to go beyond our core business, there are three criteria that must be met:

  • We must find a problem we can solve
  • It must be a real customer problem
  • We must be able to solve it in a way that is also profitable for us, and this is typically easier if we can link it to our core business

For example, the acquisition of Falck is based on solving real problems that customers have and enables us to offer a broader range of services related to car maintenance. In the same way, Flyt will enable us to increase customer contact, and can be a way to integrate other value-creating services in a better journey for the customer. This is what we are looking for – if we manage to buy a company or build services that reduce claims or increase sales, it is easier to create a business case that works – and is a win for both our customers and Gjensidige.

Lastly, I think Loss Prevention-as-a-Service (LPaaS) is also a great example that meets all the criteria. It is closely linked to our core business, prevents harm and loss for our customers, and it is sustainable and, eventually, cost-saving. So, it is very attractive for both our customers and us for several reasons.

How will you deliver on your objectives?

Fløystøl: We have set out an ambitious innovation journey, where we use several levers for success:

  • Develop new services through our internal capabilities, such as the Gjensidige Lab, and through inspiration from other markets and geographies.
  • Partnerships. We need collaborations that are more than just pure purchase agreements. We want partnerships where two or more companies invest and develop solutions together, for example a one-stop-shop for problem solving related to car maintenance and ownership.
  • Acquire companies that provide new, attractive capabilities.

We believe it is important to engage the entire organization in our innovation journey – we need expertise from many different parts of Gjensidige. After all, it is our employees who know what the customers want.

In which markets do you see strongest growth going forward?

Fløystøl: We are still most concerned with growth on a Scandinavian scale, and we are always looking for the opportunity for bolt-ons - acquiring insurance companies or portfolios at the right price. This will give us greater volume and is always relevant.

Furthermore, all services that we can scale, we scale. For example, if it works in Norway, we test it in Denmark to see if it works there. What I said about innovation also applies to growth in and outside the Nordic region. You need to invest in several initiatives at the same time and dare to scale the initiatives that provide good answers to the market.

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