Although COVID-19 forced many insurers to seek out innovative solutions, most cover providers still show room for improvement, with ratings agency AM Best scoring just 13% top marks for innovation efforts.

Last year, AM Best formally integrated a ‘Scoring and Assessing Innovation’ criteria into its rating process. After a year benchmarking the innovation of insurers it rates, AM Best found “actual sustainable results over a longer period has yet to be seen”.

“Innovation strategies vary by company and business line, and insurers generally still face difficulty with regard to the linkages between innovation inputs and results,” AM Best said.

The scoreboard found the reinsurance industry to be the most innovative insurance segment, with health and auto the next two most innovative lines of business.

While COVID-19 upended the industry’s methodically slower pace, causing insurers to act swiftly to adapt to the rapidly changing environment, the industry still scored poorly against the criteria.

The pandemic saw some insurers pause major initiatives, though many companies achieved more in the past year than in the years leading up to 2020.

“Despite the gains in creating a more-innovative culture, most companies still score at the lower end on their innovation output scores,” AM Best said.