The insurance industry has gone through many shifts since its inception as early as the third and second millennia BC. With that in mind, it’s safe to say that the modern iteration of it as we know it, which came about in the early 17th century, is the one that is poised for the most disruption. Thanks to new technologies and shifts in consumer behaviors and demands, the latest batch of trends in insurtech managed to make the insurance industry more dynamic than ever before.
In addition to enhancing the customer experience across all fronts, the latest trends in insurtech revolve around three main points:
- data management
- digitized claims processing
- utilization of smart technologies
Data Management in Insurtech
Blockchain has proven to be an effective method of data management in both fintech and insurtech applications. Since it allows for decentralized data storage, it demonstrates the potential to transform the entire model of insurance companies, permitting completely automated blockchain smart contracts, safe storage of personalized data, and offering cost-effective peer-to-peer insurance- thereby creating transparent operations built on trust and stability.
Big Data Analytics
Big data analytics provides insurance companies the capability to evaluate significant amounts of data to further understand and appraise risks. The information can be molded into core data assets, each of which are unique to insurance companies, thereby offering advantages towards improving processes.
Digitized Claims Processing in Insurtech
Processes such as claims management, and management of loss assessments and settlements are traditionally conducted manually. This is why it takes extended periods for most cases to close.
However, with the onset of artificial intelligence and digital technologies, the end-to-end automation of processes increases speed and efficiency, with little to no errors. Customers also get provided with personalized comprehensive handling reports, which adds tremendous value to their experience.
It is important to note that artificial intelligence does not take away jobs. Instead, it helps humans focus on more meaningful and impactful tasks.
Smart Technology in Insurtech
Internet of Things (IoT)
The importance of conveniences that stem from Internet-connectivity is evident from its intense worldwide popularity and dependency on everything from smartphones, to smartwatches, to connected app-enabled devices in homes and cars. It is now making its mark in insurtech.
With the information generated by IoT devices, insurance companies can offer services based on personalized risk profiles. For example, the data from a customer’s phone accelerator and GPS sensor can present accurate car accident data. The same is true with smart home technology in cases of burglaries or fires.
This feature and functionality allows insurance companies to offer lower premiums for customers leading safer and healthier lifestyles. Additionally, the data extracted insurance companies that support IoT can prove to provide the material needed to mitigate legal issues, and can help determine liability in a multitude of cases.
These trends in insurtech are radically altering the playing field for insurance companies, as they are beneficial for both the providers and consumers alike. In an effort to stay ahead of the curve, many of the world’s largest insurance and reinsurance companies are joining forces with global innovation networks such as SOSA for direct access to the newest technologies to consider adopting. It is only by undergoing digital transformations that insurance companies can become leaders in innovation with significantly improved processes, results, and most important of all- customer and employee satisfaction.