Insurtech has been gathering momentum, but still hasn’t made the grand sweeping changes that many of us had hoped for. One of the few positive outcomes of Covid-19 is that it’s providing the opportunity for brokers and insurers alike to reconsider their operations from the ground up, explains Simon Taylor, founder of get indemnity.
The Future-at-Lloyds project recently announced the launch of an open source API. This is a noteworthy step forward in ‘Lloyds of London’ history and offers a strong signal to how market participants should be designing their IT infrastructure.
For an industry that’s historically been resistant to change, there’s growing acceptance of the need to embrace the benefits of insurtech. Undoubtedly the process will be slow for the industry titans, but the birthplace of insurance has identified a clear path forward.
With data at the heart of the insurance market, the opportunities that greater connectivity, automation and intelligence are endless. How organisations best implement insurtech will remain the largest force the industry will have to grapple with.
Open banking is leaps and bounds ahead, but the untapped potential of the insurance market remains obvious. With changes to where we work, how we work, and the time spent completing administrative tasks well underway, the future looks increasingly bright.
Below we take a look at some key insurtech trends and technologies that have and will continue to shape the insurance market:
Surprising the insurance industry has been historically been poor collecting and analysing reliable data. However big data sets are now used in a multitude of ways to better understand risk selection and claim trends. Customer segmentation remains key to insurers being able to develop profitable portfolios.
Data drives the insurance market and the ability for greater connectivity improves the quality and reliability of big data. Whether to validate the underwriting of a risk or simply to reduce data input, open APIs can allow for improved data collection and efficiencies to be created in the distribution of insurance.
AI and machine learning is currently being used in one form or another by many insurers. However, the potential for the technology to automate customer service, underwriting, claims management is staggering. Not to mention harnessing with big data to offer greater insights into risk analysis and claim development trends.
Internet of things
IOT allows for better data capture, whether that’s from fitness trackers, smart devices or in-car telematics. Data that can be recorded in real time allows insurers to segment their customers further, allowing insurers to offer their most competitive pricing to deserving customers.
Advanced automation moves beyond simple quoting engines but incorporates human intervention. Complex underwriting and insurance broking increasingly combine the efficiencies of technology with the knowledge and experience of professionals to provide a personalised service.
Cloud technology has been available for some time, but the insurance market has been slow to adopt. Legacy systems and data security have been the largest concerns, but attitudes have shifted with some of the large insurers starting to adopt the technology. Whereas, the majority of smaller firms have long recognised that SaaS and cloud-based storage offers flexible, secure and cost-effective solutions.
UX / UI
The internet continues to be the first port of call for customer enquiries. They demand a compelling user experience and are increasingly technology savvy. Online applications, policy storage, claims reporting, claims monitoring and omnichannel support are some ways insurtech is currently being utilised to improve the customer journey.
Blockchain and distributed ledger technology is in the early stages of adoption in the insurance market but has huge potential. A number of large insurers have launched initiatives to see how this technology can be incorporated to improve security, transparency and accountability in the market.
An increasing number of brokers and insurers utilise multiple channels to engage with their customers. Insurtech can offer a unified brand experience so customers can switch between multiple channels and obtain a quality service. We expect to see automated chatbots taking a greater role in fielding simple enquires before human intervention.