Six Traits CTOs Need to Lead the Insurance Industry into the Digital Age

By Eric Ayala

As the insurance industry continues its transition into the digital era, the role of CTO is becoming increasingly important. Legacy businesses now face a choice: face obsolescence, or integrate new digital tools into their day-to-day operations. Those who choose the latter option need a technology leader in their c-suite who can shepherd the company into the modern age of insurance. 

The reasons insurance companies must digitize are numerous. Customers expect a seamless online experience across the entire insurance distribution lifecycle, from quoting and renewals to filing a claim. Adopting intelligent agency management technology can make meeting those expectations viable. What’s more, it can help earn and keep clients’ trust. 

The expanding influence of CTOs was clear in a study by the IBM Institute for Business Value, which surveyed 5,000 c-suite technology leaders. Of those surveyed, 40% of CTOs indicated they now report directly to the CEO, and 29% said they expect their next role to be a CEO. This should come as no surprise, given that technology is increasingly integral to business success. 

But what kind of tech leaders should insurance companies hire as CTOs? Below are six key qualities to look for. 

1. Communication skills

Whether leading the engineering team, explaining a technological consideration to the c-suite, keeping clients updated and happy or briefing vendors on the specific needs of the company, a CTO must be an effective communicator. In writing or in person, on the phone, or on a Zoom call, they’ll need to be well versed in tailoring their message to suit their audience. Of course, effective communication also means effective listening. They’ll need to understand the needs and concerns of all parties to do what you’ve hired them to do. 

2. Expert team management 

An effective CTO will ensure the engineering team is happy, motivated, and productive. This involves interpersonal skills but also equipping the team with the right tools, clear goals, and enough time in which to achieve those goals. 

3. Savvy hiring skills

Effective team management begins with hiring. A CTO needs to lead the charge in finding and recruiting the right engineering talent, to help ensure new tech is smoothly implemented and put to good use. 

4. Deep technical knowledge

As crucial as a CTO’s leadership qualities are, they should be supported by considerable expertise in forward-thinking technology. They must know the ins and outs of customer relationship management and agency management software. They’ll need a deep understanding of the differences between legacy solutions with cloud-based facades and true cloud-native solutions that can help insurance businesses meet their short- and long-term goals. All this is key for assessing the quality of a solution, interfacing with vendors, collaborating with internal teams, and helming the implementation of new technologies. 

5. Strategic thinking

The needs and goals of an insurance company will inevitably and continuously evolve. A CTO needs to be both visionary and pragmatic. They need to have one eye on the horizon and the other on the next few steps. In other words, they need to see the forest and the trees. This dual vision is critical to the success of a CTO and the company they help lead into the future. 

6. Understanding of the insurance distribution lifecycle

Insurance is a uniquely complex industry. To lead an insurance company into the digital age, a CTO will need a deep understanding of the distribution lifecycle. Integrating and streamlining all the functions of the front, middle, and back office will require empathy for customers and employees alike, ensuring newly introduced tech solutions truly serve all parties.   

Perhaps most importantly, an insurance agency’s CTO must be prepared for the inevitable pitfalls that go hand-in-hand with digital transformation. It’s not always a linear journey. The reality is, digital transformation is not a finite occurrence; it’s an ongoing initiative. Even when an agency’s “go live” technology implementation date is achieved, there will always be more to change and adjust as the agency’s customers’ and employees’ needs evolve. 

About the Author:

Eric Ayala is the senior vice president, Americas for Novidea, creator of the born-in-the-cloud, data-driven insurance platform that enables brokers, agents, and MGAs to modernize and manage the customer insurance journey. Eric has more than two decades of technology startup and venture capital experience. A Silicon Valley veteran, he has led multiple Sales and Marketing teams at startups funded by prestigious VCs such as NEA and Accel and Corporate VCs such as Dell and Microsoft.