"One key to surviving in a world of disruption, where the external environment is changing at lightning speed, is to change the game internally." — John Kotter

The extraordinary adoption of digital capabilities is changing the world at lightning speed, and the insurance industry is not immune. In a recent survey of insurance consumers, PricewaterhouseCoopers found that 70 percent conducted some form of digital research before purchasing their policies, 26 percent used a digital medium to purchase those policies, 67 percent would be willing to attach a sensor to their home or car to reduce premiums, and 68 percent would be willing to download and use an app provided by their insurance provider. Even more indicative of digital's rapid expansion, industry CEOs told Forrester Research that they expect 56 percent of insurance revenues to be digitally generated by 2020.

Unfortunately, the industry is not keeping pace with the changes wrought by this disruption. EY found that almost 80 percent of insurers do not see themselves as digital leaders and Forrester found that only 9 percent feel they have mastered digital enough to use it as a competitive differentiator.

Biggest challenges to digital success

What's holding insurers back? In a cross-industry survey by McKinsey & Company, structural and cultural issues pose the biggest challenges to digital success:

• Difficulty finding talent (functional and technical).
• Organization structure not designed appropriately for digital.
• Business processes too inflexible for new opportunities.
• Quality data and analytics to inform business decisions lacking.

The good news? Because these difficulties are largely internal, focusing on these three areas and rigorously measuring results go a long way toward shoring up your digital strategy.