"It's really about turning around insurance to be simple and easy for customers.
"We won't get to that in financial year '20 but we've certainly built the foundations that will enable Tower to have the flexibility to deliver that sort of claims outcome or customer experience," he said.
Harding doesn't anticipate the country's larger insurers can match that strategy, because "they're not as nimble and they don't have that ability and flexibility."
Tower's online drive has already started paying dividends, with yesterday's announcement of the capital raise and lingering issues with Canterbury claims clouding a robust underlying business.
The firm's online sales generated 30 per cent of new business for the insurer in the September quarter coming through digital channels, compared to just 9 per cent in the March quarter of 2016.
Still, the insurer booked $19.6m of impairment charges on software in the 2016 financial year after finding its current systems restricted its ambitions and accelerated the amortisation charge on internally developed software in 2017.
The closing book value for Tower's software was $31.3m as at September 30, after accumulated amortisation of $33m.
Information is the key benefit for insurers in the digital environment, and Harding said the industry will be able to deliver better pricing for customers with more robust data analysis.
He points to the cross-subsidisation in the larger insurers, where about six Auckland policyholders are effectively paying more for their earthquake premiums to cover one Wellington policy, which carries greater risk.
"By having cross-subsidisation you're encouraging development in places where it shouldn't be developed," Harding said.
"Should we be building commercial property on reclaimed land in Wellington harbour? Should we be allowing continued construction on 60-degree slopes on the Wellington foreshore?
"At the moment we do because there isn't a risk signal coming from the insurance industry saying that's not a viable thing to do."
Harding expects big data will let insurers move to more accurate pricing for risk, which will "mean unfortunately a higher cost in Wellington, but more affordable insurance for other people."
That's a decision which will need wide societal input, "and is a challenge New Zealand will have to face up to in the next five years or so," he said.
That shift to a digital interface will also change the nature of Tower's workforce, something the insurer has been to develop over the past year.
Harding said one of the biggest issues service staff have contended with is the duplicated systems and large suite of products, which has meant they spent less time focused on the customer.
Tower has been working on overhauling its culture from an old-school insurance firm to that of a "much more nimble challenger mindset", although Harding says they've "still got some way to go".
He doesn't anticipate a shock to the make-up of the workforce in the way some industries have been scaling back staff numbers to make way for automation, rather he wants to take staff "on a journey through as we change the company" where they can become more valuable to the customer.
"The shift that we want and the opportunity we see is how can we have a better connection with our customers, because our staff aren't being bogged down with our processes and the way the system works and are freed up to do more for the customer," Harding said.
"That does require a greater level of capability and a change in people's expectations around work, but I think it gives them greater satisfaction and greater opportunity as well."
