As we look ahead in the future, it is nice to remember the pandemic’s most important lesson: tomorrow is always unpredictable. Even at this moment, we don’t know which direction will the insurtech industry swing by. What’s certain is that we should be ready for another wave of disruption that will define the future of the insurance industry. With that, let’s take a look at a few trends that we believe will become a strong source of growth in the insurtech space.
The insurtech industry is undergoing a disruption that is challenging not only a business’ technological capacity, but also its ability to put its customers at the very core of its strategy.
While customer experience is one of the focuses of all the innovation and technological advancement we’re trying to adopt, customer-centricity is more than that. It entails the whole organization’s committed mindset by creating a culture that upholds customer importance.
An increasing number of insurtech companies value customer-centricity as a competitive advantage. The American top-rated insurance company Lemonade is one great example. Their friendly chatbot Maya is just an icing on top of the cake, but Lemonade’s transparency, flat fee, and giveback-leftover-money initiative to a nonprofit of a customer’s choice is something that others haven’t done.
If everyone’s insurance experience is seamless, from purchasing a policy to making claims, many will appreciate the insurance industry.
Unfortunately, only 29% of insurance customers are satisfied with their current providers. Enabling digital experience is one way of making the entire insurance value chain seamless and painless. However, online interactions such as multiple authentication verification, sluggish web pages, and other complex online processes can lead to customer frustration.
Intuitive, flexible, and straightforward approaches can keep pace with customer expectations heightened by the arrival of the digital era.
Data from Connected Devices
Connected devices will be a substantial part of the radical change in the coming years. According to McKinsey, an estimated 127 new devices connect to the Internet every second globally, and in 2025, the estimated number of people who own network devices will climb up to 50 billion.
Some of the fast-growing IoT applications involve the use of smart wearable devices that are getting traction in the healthcare industry and smart home devices. In the Insurtech industry, telematics, another IoT application, is often used by vehicle insurers. Flock, known for its drone and commercial fleet insurance, utilizes car telematics to ensure that insurance cover will only be triggered when the vehicle is moving.
IoT presents the insurtech industry opportunities to mitigate and reduce loss and enhance customer relationships by adding important touchpoints in products and services.
The Covid-19 outbreak caused an uptick in cybercrime, especially in the form of phishing email schemes. An industry like insurance is usually a target of cybercriminals for the large volume of policyholder information that it has. Latest infrastructure technology and highly-equipped personnel are needed to embed cybersecurity into existing software and applications.
Insurance companies are like peas in a pod in the eyes of cyber attackers. Even the global insurance provider Chubb was once attacked by Maze Ransomware in 2020.
The ability of Artificial Intelligence (AI) and Machine Learning (ML) to analyze large amounts of data quickly is an ideal help to insurance companies to be protected against malware, ransomware, and advanced persistent threats (APT).
Drones, Robots, and Autonomous Vehicles (AV)
Drones, Robots, and Autonomous Vehicles (AV) are game-changers for the transport and logistics industry, especially during the pandemic. By 2030, a study suggests that these could create a $1 billion market.
Aside from the market potential that drones, robots, and AVs have for the insurtech industry, they also offer opportunities to increase efficiency and accuracy.
According to the Intelligence Concept Manager of P&C Insurance, collected data from drones and robots can be used to create completely fresh, up-to-date maps, and 3D models, which are good tools for risk assessment and monitoring.