Friction or Progress? Why Innovation in Insurance Rarely Feels Comfortable

A question that rarely comes up

There is a question I think about more than I probably should: why do we do things the way we do them? Not the big philosophical version -- the practical one. Why does this process have seven steps? Why does this product look the way it does? Why do we collect this particular piece of information?

In most firms, the honest answer is: because that is how we have always done it, and it works well enough. Which is fair. Until it is not.

When frustration starts to signal something else

I have watched a lot of insurtechs come and go over the past few years. The ones that interest me are not the ones with the flashiest pitch decks. They are the ones that started with genuine frustration. Someone tried to buy insurance and thought: why is this so complicated? Someone tried to file a claim and thought: why does this take three weeks?

That frustration is underrated. It is what pushes people past incremental improvement and towards first principles. Not "how do we make this form shorter?" but "why is there a form at all?"

A different starting point

When you approach insurance from first principles -- what does the client actually need, what is the simplest way to deliver it -- you often end up somewhere quite different from where the existing process would take you. Not because you are smarter, but because you are not carrying twenty years of accumulated assumptions.

I say this as someone who carries exactly twenty years of accumulated assumptions, by the way. Self-awareness is the first step.

Why it can feel uncomfortable

For established firms, this kind of thinking is genuinely unsettling. Not because any single insurtech is about to put them out of business -- most will not. But because the question itself is destabilising. If someone can do this in three steps, why are we doing it in twelve?

The temptation is to dismiss it. "They do not understand regulation." "They have not dealt with complex risk." "Wait until they have to handle a real claims cycle." And sometimes those objections are valid. But sometimes they are just comfortable.

Where value starts to shift

Here is what I think is actually happening: as the mechanical parts of insurance get automated and simplified, the human parts become more valuable, not less. Understanding a client's actual situation. Interpreting ambiguity. Building the kind of trust that makes someone pick up the phone when things go wrong.

The irony is that technology frees up time for exactly the things that technology cannot do. If we let it.

Learning without copying

I am not suggesting that every broker should try to become an insurtech. That would be absurd. But I do think there is real value in watching what the newcomers are doing and asking: what can I learn from this? Not to copy it -- the contexts are too different for that -- but to challenge your own assumptions.

The best firms I have worked with do this naturally. They are curious without being naive. They appreciate what they have built without being defensive about it.

Final thought

Innovation in insurance rarely feels comfortable while it is happening. The comfortable version -- a slightly faster version of the same thing -- is not really innovation at all. The uncomfortable version, the one that asks "why?", is where the interesting stuff tends to happen. Even if the answer is sometimes "actually, we had good reasons for doing it this way."