The New Age of Insurtech – What You Need to Know About the Industry
Wednesday, September 26, 2018, 6:00 AM | Leave Comment
Insurance is a tale almost as old as time as we know it, since we as a species have created early forms of insurance to reduce and spread risk among a group in order to preserve the individual as well as the pack.
We have come a long way since the hunter-gatherer times, and the industries such as this one have the chance to either adapt or die out.
Right now, we are witnessing an evolution (or a revolution would be a better term) in how we provide and deliver insurance.
Technology advances are not reserved for the world of commerce or communication, as the notion of insurtech has become a widely accepted one for businesses with an edge.
Simply put, we are fusing the incredible benefits of technology with the idea of insurance to improve this ancient practice, although certain setbacks persist.
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Privacy and security remain an issue
Although insurance is not the only industry struggling with defining clear lines of personal privacy online and using customer data to deliver a solution, considering the complexity of the services in question, it’s by far one of the most sensitive ones yet.
For starters, insurance policies are designed to reduce any type of risk while offering the best possible coverage for their users, but certain collected data can be seen as discriminatory.
On the other hand, how far can a company go when delving into a person’s online life to utilize the collected data to create a policy? Some questions remain unanswered, leaving many companies exposed to lawsuits or unhappy customers.
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Presenting insurance in a digital realm
What might be a generation-related issue can turn into a global image problem for insurance companies worldwide. Simply put, turning such a serious matter into an appealing digital presentation for the younger generations is a complex task in itself – and it’s further amplified by the fact that trends dictate marketing strategies, and insurance companies have limited options in using them.
The less patience a potential customer has, the better the company has to be in using simple language to explain a complex concept. It’s already a competitive industry, there’s nothing “chic” or “cool” about insurance per se, and finding the right approach to appeal to the newer generations is proving to be quite a challenge for insurance companies everywhere.
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Innovation reigns supreme
Once upon a time, the key ways in which one insurance policy would differ from another included, of course, the premium, the level of coverage, how fast the policy is not only issued, but activated as well, and the like.
By utilizing technological advances such as AI in determining a policy for any customer online, the leading insurtech companies introduce a level of innovation that has not been used before.
Add to that the ability to use technology to present information in a simple format based on relevance, and guide the customer every step of the calculating process, technology enables greater transparency as well as personalization.
Now, when the time comes to choose the best insurer for a life insurance plan, for instance, customers have a wider range of determining factors to consider, and far more innovative options at their fingertips. Tailor-made policies, instant access, and clarity are just some among the many modern-day perks of insurtech.
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An increase in savings
Every individual considering any long-term insurance, whether it’s a life or a health insurance policy, understands that this is a necessary investment that provides a priceless perk in the shape of your peace of mind.
However, technology enables the most advanced insurtech companies to utilize digital solutions, such as platforms that handle insurance claims automatically, or machine learning software that can predict risk behavior of the insurance holder. This further enhances the level of personalization in individual policies and creates offers that fit the company as well as the client.
Using smart algorithms, drones, and AI, insurtech leaders can reduce the time and costs needed to process claims, estimate property damage based on aerial images and exclude any pre-existing issues that may otherwise affect the claim. This reduces the risks of overpaying or underpaying and the need to send people to the site, and makes filling out endless pages of paperwork redundant. Both the insurance company and the client save time as well as money from the earliest stages of the relationship.
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Steadfast regulations
The legal side of insurance, both for the potential policy-taker and the company, remains an area that is reluctant to allow too many disruptions, even in the form of innovation. It’s a well-known fact that insurance companies, as well as any legal administration of any country, are not inclined to take risks too lightly, whereas such fast-paced changes in tech make it almost impossible to stay stagnant.
Photo credit Pexels
Photo credit Pexels
Photo credit Pexels
While some companies are eager to move forward with their offers and leverage technology to their advantage, it is still a difficult task for legal authorities to clearly define the rules and regulations underlying such services.
Hopefully, this particular issue will be overcome with the help of digitally friendly laws as the foundation of the future of insurance as well as other industries.
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