Understanding the Difficulties of the Insurance Industry in Innovating and Transforming Itself Through Digitalisation Imposed by New Entrants.

The study compares the different nature of incumbents and insurtechs to explain the digital transformation path in the insurance industry in Singapore. The study shows that insurance players are dealing with a complex industry that requires insurance expertise and experience beyond digital know-how. The barriers to entry (e.g., regulation, capital, compliance), the difficulties to respond to a passive demand (e.g., poor value perception, no willingness to pay), and the necessity to provide a well-processed supply (e.g., technical nature of insurance, underwriting, after-sale and claims management) favor the position of incumbents and challenge the fragile ambition of digital entrants New entrants maybe experts in digital technologies, yet they lack experience in insurance which is critical to comprehend a complex regulation and a conservative consumer. Incumbents understand the importance to transform, but are slow to digitalize. The results highlight that the priorities of the traditional players are to protect the company legacy and comply to the regulation. Incumbents endorse innovation as a defensive rather than an offensive strategy. Lastly, the study shows that incumbents should accelerate their digitalization by making their organization and governance more agile while recruiting more tech savvy resources.

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