Chapter:
Introduction
3
third party payment service providers (TPPs) such as nontraditional banks and fintechs.
In effect since January 2018, the intent of open banking legislation is to provide
consumers with more choice. By allowing third party providers to create new financial
services offerings with aggregated bank account data, its objective is to level competition
by enabling AISPs and TPPs access to valuable customer data and payment capabilities.
Most European banks are choosing to comply with PSD2 by utilizing open API
technology.
These forces pressure insurers to digitize their businesses, and this urgency is reflected
in insurers' business strategies. In a recent survey of 99 insurers, virtually all agreed that
digital transformation was a critical part of their strategy.
Figure 1: Q: Indicate your level of agreement with the following – "At my company, digital is a
critical part of our business strategy." (n=99)
Source: Celent report Digital Transformation in Insurance
Dealing with these new challenges and opportunities requires changes to both IT
systems and business processes. However, when asked what will get in the way of the
transition, insurers identify existing systems as their top barrier.
2%
11% 17% 28% 42%
0% 20% 40% 60% 80% 100%
Strongly Disagree Somewhat Disagree Agree Somewhat Agree Strongly Agree
