Digital technology has taken the world by storm, as we all know. There isn’t a single aspect of our life that hasn’t undergone major changes following the breakthroughs in IT. Every field of business has had to adapt to the new circumstances and only those companies who managed to embrace the novelties have survived.
The insurance sector is no exception. Companies are trying not only to implement technology in their business operations, but they are actually making it possible for technology to lead the whole process. So, how have technological innovations affected insurance trends?
Shift in focus
Since millennials are now the largest living generation, at least in the US, it is only logical that insurance companies have to tailor their offer and present it in a way that is expected from those who don’t remember the time before the digital revolution.
Shortening the application process
Long gone are the days when you needed to fill in many forms and collect various papers if you wanted an insurance policy. For instance, you can now finish everything without having to leave your home and have the right policy delivered to your door thanks to online application forms.
Every business strives to increase the profit and lower the expenditure. When it comes to insurance companies, reducing the cost of claims processing is one of the main goals. If blockchain technology helps with that, while at the same time providing greater safety and immunity to traditional cyber threats, it’s easy to see that insurers are becoming increasingly aware of the benefits.
Labour market change
Wealth management and financial advisory are experiencing drastic changes with robo-advisors providing offers and advice to customers. This means that fewer people need to be employed without any fear that the scope of work will be reduced.
Customers can now digitally switch insurance cover on and off, depending on their wish at the moment. This flexibility comes at a price, but modern technologies have made this option widely available in most countries.
More value is given to IoT
Just like other businesses, insurance companies want to know as much as possible about their clients, so that they are able to create more relevant packages. IoT also makes it possible for claim processes to be automatic, which significantly shortens the process to the satisfaction of both sides.
Insurtech innovations have made it possible for everyone involved to enjoy a faster, reliable and much more transparent process. For example, insurers expect to face some important questions about the best life insurance policies and companies which have embraced modern technology can show their potential clients exactly what is entailed in the process of calculating premiums. While you’re completing a form online, you need to enter the info which is variable, but relevant for the premium, such as your age, for instance. The system will immediately make you a comprehensive offer since there are no hidden costs or professional jargon that hides them.
As we’ve established already, AI allows insurers to mine much greater volumes of data, but it also provides other benefits. One of them is the ability to scale analytics across the organisation, which can help such businesses become faster and smarter. Also, AI has brought about a possibility to have very precise predictions when it comes to future business operations.
Insurers all over the world have realised how important it is to include automated underwriting technologies. Without them, there is no instant and direct access to insurance products, which meant they would potentially lose many clients for not allowing this option.
Micro-insurance for personalised service
With all the data available to insurance providers, it comes as no surprise that they not only know what kind of offer prospective clients are interested in but can also predict, with great certainty, at what time such offer would be relevant and for how long. With an increase in flexibility, transparency and speed at which the process takes place, insurers are now able to tailor very specific offers for individuals and even the smallest niches.
Similarly to other fields, the insurance industry is trying hard to reap as many benefits as possible using modern technology. The sophisticated processes have significantly shortened the time needed to close a deal, while at the same time they have allowed a much greater variety of products to be offered. The trends may slightly differ in various parts of the world, but those mentioned here are global ones that are bound, sooner or later, to influence this line of business everywhere.
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