The impact of technology on the insurance industry continues to be one of the more underrated developments in fintech. And while the level of disruption varies from one region to another, the intersection of insurance and technology is the growing source of innovation.

This year at FinovateEurope, we spoke with Roland Woerle, founder and partner of KONSULTA.eu, a boutique advisory firm, based in Austria, with a focus on the European insurance industry. KONSULTA helps insurers and brokers increase revenues, improve their customer experience, and manage business transformations.

“We are different, refreshing, highly-competent, fun, value-driven, and 100% customer focused,” Woerle described KONSULTA by way of introduction. “We are trying to help insurance players in their transformation, innovation, and customer/employee value propositions.”

Woerle is also senior representative at Vienna-based Match-Maker Ventures, where he helps startups that have already reached the proof-of-concept level scale their businesses. Previously, Woerle spent more than five years as Chief Operations Officer (Nordics/ Austria and CEE) for global financial services firm Aon, and more than ten years as Chief Operating Officer (Austria, CEE, CIS, and Nordics ) for leading insurance broker Marsh.

We talked about the role of technology in accelerating processes in insurance, and which business models benefit the most from the cost savings of technologies ranging from robotics to satellites. We also discussed the key distinction between companies with innovation teams and companies with innovation cultures, and the challenges businesses face in developing the latter from the former.

“Large insurance organizations they are still struggling with (this),” Woerle said. He pointed to issues with the company’s best and brightest often being pre-occupied with other, day-to-day tasks, as well as an incentive structure that does not reward what he called a “try and fail fast” approach to innovation, as major obstacles. Add to that insurance companies’ traditional risk aversion and it’s easy to see why “unconventional ideas,” as Woerle referred to them, face a challenging road to adoption.

Here are some of the top takeaways from our conversation with Roland Woerle this year at FinovateEurope in Berlin.

On platformification and the future of the insurtech

Woerle: (The platform economy) is highly relevant for insurance. We had a good debate in the afternoon, discussing where insurance companies might go into, and how they might become platform providers and solution providers for platforms. The industry as such might evaporate over time and morph into the platforms.

It’s a bit of a scary thought on the one hand. But, on the other hand, it’s a great opportunity for those who actually partner with the right platform providers. They can actually grow and grasp new opportunities in the market.

On the main ways the technology is changing the traditional insurance business

Woerle: I think that there are probably three areas where technology is really changing (insurance). First of all, it primarily speeds up the processes along the insurance value chain. Whether it’s distribution, underwriting, customer service … there’s huge potential for claims … just to make the process faster.

I see also tremendous potential on the B2B side, especially the large B2B speciality insurance lines like marine, where you can actually use satellite tracking, blockchain contracts in much more innovative ways around data analytics to drive down the tremendous costs in that industry.

On the relationship between insurance incumbents and insurtech startups.

Woerle: It’s still a difficult relationship to make work. I guess it’s the same as in the fintech space. It’s one of the things that KONSULTA is actually focusing on. We are working with startups and working with industry leaders to better match them to make sure it’s a win/win case for both of them.

They need to be true partnerships. Incumbents cannot see a startup just as a supplier. This won’t work. They will fail any procurement process. They will not “tick the boxes” which they need to tick. (Incumbents) need to nurture (startups). They need to see them as strategic partners.

So bringing them together, speaking the same language, seeing where value is added on both sides, and how can they make a win/win situation … I think that is the way to succeed.

Watch the full, six-minute interview on Finovate TV.

One of the more consistently insightful observers of the fintech industry, author Chris Skinner, highlighted the rise of central bank digital currencies as one of the more surprising conversations at FinovateEurope this year.

“China’s about to launch one, there’s going to be a digital dollar from the Fed at some point probably,” Skinner said. “And the implications of that on cross border payments and infrastructure was one of the topics that was a little bit off track to me because it hadn’t come up before. So I enjoyed that immensely.”

That said, the man behind theFinanser.com and chair of the Financial Services Club spent the majority of our conversation in Berlin talking the discussions he’s had with leaders in the banking industry who are tackling the challenge of digital transformation head on – and succeeding. These insights are at the core of Skinner’s upcoming book, Doing Digital, to be published in April.

Skinner also shared some insights on banks and their role in digital identity management. He noted Head of OP Lab for Finland’s OP Financial Group Kristian Luoma who pointed out that even in a future in which banks aren’t involved in payments or authentication due to intermediaries like Square and Apple ID, for example, there is still a critical role for banks to play. But banks must be ready to share the ball.

“It’s one of the few times I’ve heard a bank actually stating that in such a clear way, because most banks still think they have to own and control everything,” Skinner observed. “The idea of being just a player in a system – that’s the way we have to think for the future.”

Here are some of the top takeaways from our conversation with Chris Skinner this year at FinovateEurope in Berlin.

On why a “bare-knuckle approach” to the challenge of successful digital transformation is appropriate – if not required

Skinner: Digital transformation is not easy, it’s really hard, it takes years, it involves balancing business-as-usual with business-as-unusual, and it’s something that had to be led by the chief executive and chairperson and cannot be delegated. I find too many banks think that digital (transformation) is a project or a function or a budget that can be delegated. But that’s absconding the reality. The reality is that you have to own it.

On the swim-or-sink approach companies that succeed in digital transformation have adopted to ensure a digital-positive culture

Skinner: The most difficult thing in any transformational project is getting the middle management to buy into the project and participate. And commit. Because often the middle management are the most worried about what’s happening. They think they are going to lose their job or they might lose their part of the organization or they might lose their power. They might lose their people. They might lose their promotion. So they fear change rather than embrace it. And it’s really a case of: how do you bring those people with you?

On the progress some innovative banks are making toward digital transformation.

Skinner: One of (the banks I interviewed for Doing Digital) had a head of ecosystems. It’s the first time I ever met anybody at a bank who’s called the “head of ecosystems.” His pure role was to go out and find appropriate partnerships – in the world of APIs and apps and analytics – on open platforms and bring them in to work with the bank. At the time, they had about ten partnerships, and I think today they’ve more than doubled that number. So there are some banks taking it very seriously.

Watch the full, 10-minute interview on Finovate TV.

With one startup for every 1,400 citizens, Israel may have the highest “innovation per capita” ratio of any country on Earth.

That makes it little surprise that Itai Green, founder and CEO of Innovate Israel, would be the one to help explain what corporates need to do in order to make the most out of their collaborations with startups at FinovateEurope in Berlin last month.

Green advocates an innovation model – open innovation – in which corporates leverage their local ecosystems to collaborate and partner with startups, entrepreneurs, universities – even customers and other corporates – in order to develop whatever products or services will allow it to grow and expand. This argues against the in-house innovation model, which many have found to be an insufficient way of driving major innovation due to factors ranging from a lack of internal incentives to inconsistent and/or unclear support from management.

Green made the case to our audience that open innovation provides the lowest risk and the greatest return on investment a company can ask for – if they do it right.

In his presentation at FinovateEurope this month, Green outlined the most important factors that businesses need to keep in mind when working with innovative companies in an open innovation context. He listed nine distinct “Tips for Corporates” – a few of the more compelling ones are highlighted below.

Commitment – A theme that was quite common at FinovateEurope in Berlin this year – that bringing tech-savvy diversity to a financial institution’s board of directors was a must – was echoed strongly by Green. He advocated that companies have at least one technology/innovation-oriented board member – though having three, he noted, was far better. Green said that this kind of board representation was increasingly common in Israel where he pointed out that boards of directors typically had 20% of their members under the age of 40. Compare this to the S&P 500, where the age of the average board member is above 60.

FOMO > NIH – Even among companies that have recognized the importance of digital transformation, there can be a reluctance by corporates to embrace non-native ideas. This “Not Invented Here” attitude can be especially harmful when working with innovative startups, who often arrive on the scene with a passion to, if not disrupt, then certainly make a clear difference for their partner and a strong representation of their technology.

Green argues that a “Fear of Missing Out” on the next big opportunity is a more healthy psychology for the corporate when working with a startup rather than any sense of injured pride at not having come up with the innovation on their own.

Show Startups the Money – Another highlight on Green’s list was the importance of paying for the work. This was a point that Steve Frook of Best of Show winner Horizn would underscore in his FinovateEurope presentation, Landing Your First Bank Customer, later that day. From Frook’s perspective, it was important that startups avoid the temptation to, essentially, work for free in an attempt to show their enthusiasm and eagerness to collaborate. Establishing a business relationship – even a modest one – was an important early step for startups to take, Frook suggested. Green, from the perspective of advising the corporate, concurred. Companies should come to collaborations with startups with a budget and be prepared to use it. Paying startups, Green explained, sends a positive, professional signal to the company and to the broader community of innovators and entrepreneurs, as well.

Founded in 2017, Innovate Israel helps partner global corporations with innovative entrepreneurs and startups in Israel to help them implement advanced technologies in their businesses.