Rebuilding Insurance from the Customer Backward: Why Iteration, Not Reinvention, Defines the Future
For decades, the insurance industry has operated with a fundamental asymmetry: insurers built products from their internal logic outward, while customers evolved in the opposite direction. The result is not a broken system, but a widening gap, one that cannot be closed by reinventing the wheel, but by rebuilding the industry from the customer backward.
This distinction matters. Reinvention implies tearing down what exists. But insurance is not broken. It is structurally sound, intellectually robust, and populated by professionals who understand risk better than any other sector on the planet. The issue is not the discipline; it is the distance between historic operating models and modern expectations.
Today, that distance is expanding exponentially, driven not only by digitalization but by the psychological shift in what customers consider “normal.” Whether young digital natives or older generations who adapted rapidly through the COVID-era acceleration, the baseline of expectation has fundamentally transformed. Availability, immediacy, transparency, and fairness are no longer differentiators; they are the floor.
Insurance is adapting: steadily, thoughtfully, and in ways that reflect both customer expectations and industry constraints. And adaptation, at scale, requires something far more sophisticated than reinvention. It requires re-engineering the value chain from the customer backward, through iterative, validated steps that protect the integrity of the system while enabling meaningful, sustainable evolution.
The Customer Has Already Moved, and They Are Not Going Back
The internet reshaped customer behavior over the decades. AI is reshaping them in months.
In the early 2000s, digital adoption progressed slowly, buffered by habits formed long before the first broadband connection. But with the arrival of intelligent automation and generative AI, customers now experience speed, availability, and personalization in nearly every consumer-facing industry, including banking, retail, entertainment, mobility, and even healthcare.
Insurance evolves more slowly because insurers must manage multiple generations of products simultaneously, including contracts and systems designed 20, 30, or even 40 years ago, all operating in parallel. This divergence is neither due to incompetence nor unwillingness to adapt. It is the consequence of rigid value chains, regulatory constraints, and the sheer complexity of operating a risk-bearing institution on a global scale.
The pandemic accelerated this gap further. As physical interaction disappeared, digital expectations intensified. A population unable to speak to people in person suddenly expected immediate responses online. And industries responded. Insurance partially did too but not at the same pace.
Today, customers, whether individuals or global corporates, expect:
24/7 availability
Fast, clear responses
Personalized offerings
Simple, transparent interactions
A sense of partnership, not just a policy
These expectations will not slow down. They will only accelerate. Insurance must choose whether to catch up by force or evolve methodically, intelligently, and sustainably.
Why Top-Down Reinvention Fails
Many insurers respond to the pressure for modernization with large-scale programs designed to transform systems, processes, or distribution. The ambition is admirable. But execution often falters, not because the strategy is wrong, but because the path is unrealistic.
A full “big bang” approach assumes:
The value chain can be rebuilt at once
All internal dependencies can align in parallel
Customers will consent to wait for perfection
Complexity can be controlled from the top
None of these assumptions holds.
Insurance value chains are interdependent, regulated, and capital-intensive. Operations are optimized for stability, not agility. Teams understand the constraints deeply; they are not short on intelligence, but on maneuverability. When leaders impose reinvention without respecting these realities, the system resists, and projects stall.
The lesson is simple:
You cannot revolutionize insurance by ignoring what makes it work.
What we can do is rebuild it from the only perspective that matters, the customer’s, and adapt the value chain iteratively to meet the needs of the future without compromising the integrity of the present.
Iteration: The Only Sustainable Path to Transformation
Years ago, I led the global development of a highly complex insurance product for very large multinational corporations. It spanned jurisdictions, regulations, policies, and operational frameworks across an entire group.
Had we attempted a fully formed solution from the start, the project would have collapsed under the weight of its own ambition.
Instead, we built iteratively with clients.
We designed the first version of the solution, brought it to a prospective client, received feedback, and adapted. That first client did not buy the product. At the time, this felt like failure. It wasn’t. It was the first signal that co-creation, not internal perfection, is the real engine of innovation.
Two or three cycles later, shaped by client input, validated by additional stakeholders, operationally aligned across the organization, the same client bought the product.
But here is the insight that stayed with me:
The product they bought was not the product they originally asked for.
This is the nature of iterative development:
Customers express needs in the language of their current constraints
Insurers translate those needs into actionable, compliant, operational solutions
The final product emerges through cycles of alignment not a single moment of design
Iteration reduced risk, protected the value chain, accelerated adaptation, and ensured the solution endured over time.
The lesson extends far beyond corporate insurance. In individual segments, where expectations shift even faster, iteration is not just recommended, it is essential.
Why Focus Groups No Longer Work as They Once Did
The traditional mechanisms for customer insight surveys, focus groups, and advisory panels were adequate when expectations changed slowly. But today, they are outdated almost as quickly as they are completed.
Personalization is no longer a luxury. It is the baseline.
Focus groups produce averages. Customers expect precision.
Focus groups are episodic. Customer expectations are continuous.
Focus groups look backward. Customer behavior evolves forward.
This is why insurers must shift from:
Static product development → Dynamic offering ecosystems.
And this distinction matters. A product is the contract; an offering is the entire experience around it, services, partnerships, digital tools, education, support, prevention, and outcomes.
The product itself must remain:
simple
fair
transparent
fast
easy to explain
But the offering can be expansive. And this cannot be built alone.
Insurance Cannot and Should Not Do Everything
The coming years will make one reality clear: insurance is no longer a closed value chain.
Distributors, service providers, healthcare partners, technology firms, platforms, and ecosystems are shaping the customer experience as much as the insurer itself. Rather than resisting this decentralization, insurers should embrace it, but with orchestration.
Being the orchestrator is where the insurer’s leadership becomes decisive.
If insurers do not lead the ecosystem, they become one vendor among many.
If they overextend, they lose focus and operational stability.
If they orchestrate, they capture value while elevating customer experience.
What Orchestration Really Means:
Orchestration is not about insurers owning or delivering every capability. It is about coordinating a broad ecosystem that includes:
clients themselves
distribution partners - brokers, MGAs, agents, affinity groups
service and assistance providers
technology and platform partners
data and analytics players
regulators and compliance stakeholders
Insurers become the conductor of this ecosystem: absorbing signals, setting the pace, ensuring coherence, and shaping a simple, trusted experience despite the complexity behind the scenes. Without this leadership, the iterative journey becomes fragmented and loses momentum.
The Role of AI, Digital Infrastructure, and Speed
AI is reshaping the industry faster than any previous technological wave. It touches underwriting, claims, distribution, cost structure, risk assessment, personalization, and leadership models.
Critically, it also accelerates the divergence between competitors.
Large insurers possess scale, data, and established processes. Smaller players possess speed. AI compresses both advantages into a race of adoption. Those who master AI will not just improve efficiency; they will redefine the economics of insurance.
This will lead to significant consolidation, driven by:
data integration
digital compatibility
transparency
process automation
operational scalability
In an AI-first industry, an insurer that lacks modern infrastructure may struggle to integrate into an acquisition. Digital alignment will become as important as cultural or financial alignment.
AI is not replacing insurance. It is exposing inefficiencies, amplifying strengths, and accelerating the shift toward customer-backward design.
Personalization: Beyond Economics, Into Trust
Insurance is often perceived as a rational, quantitative business. But fundamentally, it is emotional. It is a promise one that must endure over years, even decades.
Personalization strengthens that promise.
To personalize effectively, insurers must understand:
the lifecycle of the individual
their context and priorities
behaviors, risks, and aspirations
the triggers that change their needs
how those needs evolve over time
This is where data used responsibly creates real value. Cross-referencing health, lifestyle, claims, prevention, and service usage can enable tailored recommendations that enhance protection and long-term outcomes.
But personalization only works if it remains:
simple
explainable
ethical
beneficial to the customer
Otherwise, trust evaporates. Insurance is not just a contract. It is a contract built on trust. And trust, once lost, is far more expensive to rebuild than any value-chain transformation.
Redefining the Customer Relationship Across a Lifetime
A customer’s relationship with their insurer changes dramatically over time. Someone buying their first policy at twenty has different needs, expectations, and emotional triggers at forty, sixty, or eighty.
The insurer’s responsibility is to be present at the moments of truth:
The night a parent worries about their child’s health
The day a business experiences a major operational incident
The moment someone receives a difficult diagnosis
The transition into retirement
The first claim they ever make
Availability matters not only as a service feature, but as an emotional signal:
“We are here when you need us.”
Digital tools enable this. AI enhances it. But human experience anchors it.
If insurers want to rebuild from the customer backward, they must design offerings that respond to the complexity of human life, not the constraints of insurance operations.
Reinventing Insurance Backward: What It Truly Means
Rebuilding insurance from the customer backward is not a slogan. It is a disciplined operating philosophy that requires:
1. Understanding the constraints of the entire value chain, including distribution.
Insurers cannot overpromise transformation without acknowledging the operational realities across underwriting, claims, technology, customer service, and distribution channels. Distributors must be part of the listening process; they bring client proximity and operational intelligence that is indispensable.
2. Investing along the value chain in controlled, validated increments
Iteration preserves operational stability while enabling continuous improvement.
3. Building with customers, not for them
Co-creation replaces internal perfectionism.
4. Orchestrating an ecosystem bringing together clients, distribution partners, and service providers.
Insurers should not attempt to deliver every service internally. Instead, they must integrate the contributions of distribution networks, client insights, and external partners. Listening to distribution is as essential as listening to clients: both shape the offering, both validate direction, and both determine relevance.
5. Using AI and digital infrastructure to enhance speed and personalization
Technology becomes a differentiator, not a buzzword.
6. Preserving simplicity, fairness, and transparency
Transformation fails the moment the offering becomes confusing.
7. Recognizing that insurance is an emotional business
Trust is the most valuable asset. Experience is the most powerful differentiator.
The Future of Insurance: Different, Not Disrupted
Insurance is not going anywhere. It remains a fundamental pillar of economic stability and societal resilience. But the form it takes, how it operates, how it engages, and how it delivers value will not resemble the insurance of ten or twenty years ago.
The industry will evolve because customers have already evolved.
The challenge is not disruption.
The challenge is alignment.
And alignment is achieved not through sweeping transformation, but through disciplined iteration, guided by the people who ultimately define value: the customers themselves.
The insurers that embrace this approach will not just survive the next wave of change; they will lead it. Those who cling to yesterday’s models may still exist, but they will be irrelevant.
Rebuilding from the customer backward is not the fastest path.
It is the most sustainable one.
And in an industry built on longevity, sustainability is the ultimate competitive advantage.
François Jacquemin
P.S.: Want to watch the video version of this article? Go to https://www.francoisjacquemin.com/covered/rebuilding-insurance-around-the-customer