The total annual volume of property and casualty (P&C) and life insurance policies sold through digital channels in Europe could reach €25 billion in 2016, more than double the 2012 value of €12 billion, according to a new Accenture (NYSE:ACN) study based on a survey of 78 insurers across Europe. According to the study, policies sold through digital channels are expected to account for 18 percent of European insurers’ total annual new business premium volume in 2016, compared to 11 percent in 2013. The study also finds that three-quarters (78 percent) of European insurers are planning to increase investments in the digital transformation of their sales and distribution functions, and expect to spend €27 million, on average, in this space over the next three years. “The shift to digital is inevitable for insurers and our study reveals that the industry is investing heavily to transform itself,” said Piercarlo Gera, global managing director of Accenture Distribution and Marketing Services. “This transformation is critical to attract consumers who are becoming increasingly unwilling to buy a product or service that does not provide the same levels of convenience, simplicity and speed to which they have become accustomed from many other services they use every day. Especially, the “digital generation”, or Generation D, which is permanently connected and used to purchasing books, electronic devices, music and travel online. Insurers must invest in capabilities with a clear strategy to improve the overall customer experience with every interaction.” The complexities of managing changes across physical channels is perceived by insurers in Europe as the most important challenge in the digital transformation of their distribution, cited by 85 percent of respondents. Other significant barriers include the constraints of their IT legacy systems (81 percent) and the inability of their organization to act quickly (81 percent). The study also indicates that nine European insurers out of ten (89 percent) are expecting competition to intensify in the insurance distribution market over the next three years. Almost two-thirds (64 percent) believe that this competition will come from non-insurance players, such as Google, or e-commerce giants like Amazon.