Transforming the linear insurance business model to a closed-loop insurance model: A case study of Nordic non-life insurers

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Abstract

Businesses are expected to become engines for positive change, and mounting evidence indicates that corporate sustainability is a success factor for businesses around the globe. In this context, the 'business as usual' approach to running businesses with negative environmental consequences is not an option. Industrial ecology and sustainable business models offer solutions on how this transformation can take place. However, transformation of non-manufacturing industries in this respect has not been covered in the literature. The aim of this paper is therefore is to use scientific and industry literature and interview data from the Nordic non-life insurance sector to propose closed-loop insurance models. The new models allow insurance leaders to move away from running the insurance business in an old-fashioned linear way, and thus gain a better understanding of how the business contributes to sustainable development. The transformation of insurers' business models is an example of how business models of non-manufacturing industries can be reinvented to support sustainable economic growth by utilizing ideas from industrial ecology. The new business models proposed place insurance business models within the overall research in industrial ecology, thereby filling an evident gap in the literature by showing that the closed-loop concept applies to non-manufacturers.

Original languageEnglish
Pages (from-to)341-355
Number of pages15
JournalJournal of Cleaner Production
Volume83
DOIs
Publication statusPublished - 15 Nov 2014

Bibliographical note

Funding Information: I wish to thank Nordic insurance experts and specialists for their permission to be interviewed, insurance specialists for reviewing the models presented in the paper, and the anonymous referees and editors for their valuable suggestions and comments that have substantially improved this paper. I would also like to thank those who provided funds towards this study, including Landsvirkjun Energy Fund , Orkuveita Reykjavíkur Environmental and Energy Fund , the Erasmus Programme of Student Mobility for Study or Placement , the Pálmi Jónson Nature Conservation Fund , RioTintoAlcan Community Fund , the Nordic Centre of Excellence for Strategic Adaptation Research (NORD-STAR) , the Nordic Climate Change Adaptation Research Network (NORDCLAD-Net) , the Nordic Climate Mitigation , Adaptation and Economic Policies Network (N-CMAEP) , the University of Iceland School of Business , and SHÍ Student Fund . Publisher Copyright: © 2014 Elsevier Ltd. All rights reserved.

Other keywords

  • Closed-loop system
  • Linear process
  • Non-life insurer
  • Sustainable business model
  • Transformation

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