The life and pensions sector is transforming at an accelerating pace. Consumers are willing to engage with only the best digital experiences, with mobile increasingly the primary point of access. Coupled to this is the need to reinvent and simplify business models to be highly digital, fully automated and efficient.
The cost of living crisis, high inflation, couple with rising interest rates and low wage growth, is putting pressure on personal finances especially for the most financially vulnerable. Meanwhile, the deep and sustained equity marker sell-off material weakens pension and other savings balances which has led to some investors withdrawing assets. Pensions and life insurance contributions may be reduced or stopped as consumers seeks ways to meet their financial commitments.
Firms cannot afford to stand still. We see a number of firms re-evaluating their purpose and strategy in this context, and driving initiatives to address multiple imperatives. These include regulatory requirements, the digitalization of customer, advisor and colleague journeys, the implementation of new technologies and API integration, cloud migration and new data platforms for matching, pricing, reporting and ESG purposes. Legacy systems modernization as part of this is essential.
Customers are demanding simple, holistic digital experiences. With our combined product, innovation and design capabilities, we offer targeted services aligned with provider priorities to transform existing experiences or create new propositions or business ventures. Using our Innovation Lab, we lead with customer research to define what customers want.
Our findings shape product strategy and proposition design. We also support the delivery of new products to market through embedded specialists across product management, research, and UX and UI design.
The advice market is consolidating at an increasing pace, often in tandem with a shift to integration. To counter narrowing access to distribution, providers are broadening customer engagement by developing digital guidance and advice capabilities.
We help providers define their strategy and customer centric principles and understand what they need to do to engage effectively in an omni-channel environment – including customer contact centers – where a consistent experience delivered across all channels is essential to sales and asset growth.
Increasing emphasis is being placed by the regulator on the needs of the customer, with providers being forced to demonstrate value and how they will avoid harm. For example in the UK in 2023, the FCA introduces a new Consumer Duty, building on Vulnerable Customers and Treating Customers Fairly legislation.
We work with providers and advise firms to determine how best to implement new regulations. Using gap analysis, we identify risks and develop ‘path to green’ strategies required to achieve compliance, utilizing our expertise in conduct risk, data, digital and programme management.
To maintain the ability to innovate and protect margins, providers must simplify their technology. Consolidating platforms or migrating to the current release is key to maintaining an edge. Such migrations are complex and require a carefully considered approach and team.
Capco has extensive experience in managing complex pension and investment platform migrations. We work with clients to develop the right approach and framework, supported by specialist teams across programme management, governance, ways of working and data – delivering at scale and cost-effectively.
Rising regulatory and operating costs continue to add margin pressure. Such pressures drive consolidation, leading to a myriad of systems that were historically designed to support product-led sales, inhibiting the creation of engaging and digitally led customer journeys - and cost reduction opportunities.
We help providers rectify this. In addition to our capabilities in systems integration and platform migration, we assist in other ways such as defining technology strategy and architecture, cloud migration and change sourcing to accelerate cost reduction.
Data is key to maximizing the value of customer engagement. As providers digitize products and services, unlocking the value of data lies at the core of delivering a better experience, and ultimately growth through direct and intermediated channels.
Our data practice has depth of expertise across multiple areas including data analytics and insight, data strategy and advisory, data architecture and automation.