Transformation is fast becoming the next overused word in insurance, right behind digital and innovation. But the fact that so many commercial lines insurers are talking about transformation indicates a reality — there is definitely fundamental change underway. It is true that the basics of the business remain the same, and many of the headline-grabbing initiatives are not yet driving big financial gains. But in those headlines and the behind-the-scenes strategies and pilots underway, there is a palpable sense of real transformation. And it is changing the industry for the better.

SMA's recent research report, "2020 Strategic Initiatives: P&C Commercial Lines," provides more insight into this transformation. It addresses both what insurers are doing and why they are doing it. The 'why' discusses the factors compelling insurers to embark on transformation, while the 'what' covers insurer strategies and plans and their stage of development. Great progress is being made in the overall digital transformation as well as a dozen other initiatives ranging from improving customer engagement to building world-class data/analytics capabilities. SMA's observation from working on strategy with insurers is that there are actually two levels of transformation underway.