Modern insurance technology now for both carriers and insured’s is an integral part of the P&C industry. Sending insurance offers can be as simple as clicking on a button, usually handling policy can be achieved with a mobile device, and paper insurance cards are primarily a thing of the past. Insurance technology is expected to mature even more in the coming years. Although some carriers still use some of these techniques, we are seeing them become increasingly ubiquitous across the industry. Insurers seeking a strategic advantage will consider adopting the emerging trends in insurance tech.
Listed Below are Few Technology Trends Transforming the Insurance Industry
• Predictive Analysis: Many insurers use predictive analytics to collect a range of data to understand and forecast consumer behavior. There are also new ways in which it can be used to boost data quality. Insurance companies may use predictive analytics to select rates and costs, classify clients at risk of loss, classify fraud risk, triage claims, identify outlier claims, and anticipate trends.
• Artificial Intelligence (AI): Consumers often seek customized experiences, especially when purchasing something as crucial as P&C insurance. AI allows insurers to build such exclusive skills, fulfilling modern consumers’ high-speed demands. With AI insurers can increase turnover times of claims and radically change the process of underwriting. AI also helps insurers to access data more efficiently, and cutting down on the human factor will lead to more reliable reporting in shorter times. The initial effect of AI would mainly be related to increasing efficiencies and automating current underwriting and claims processes for customers. Its impact will be broader over time; it can define, analyze, and underwrite emerging risks and define new sources of revenue.
• Machine Learning (ML): The developments in insurance technology in recent years will involve the convergence of different innovations, all in the context of enhancing precision. According to Forbes, “Machine learning is an AI branch, but it’s more basic. ML is based on the premise that we can create data processing and learning machines on their own, without any constant supervision.” ML can not only enhance the interpretation of statements but can also simplify it. When files are digital and available via the cloud, they can be analyzed using pre-programmed algorithms to increase the speed and accuracy of processing. This automated analysis can have more effect than merely claims-it can be used for decision management and risk assessment.
• Internet of Things (IoT): Most consumers are willing to share extra personal information if it means saving money on their insurance plans–and much of that data sharing can be automated through the Internet of Things. Insurers may use data from IoT devices such as the various components of smart homes and wearable technology to help assess prices, reduce risk, and, in the first place, even avoid failure. IoT can bolster other insurance technologies with first-hand data, improve risk assessment accuracy, and give the insured’s more power to influence their policy pricing directly.
• Social Media Data: Social media and its role in the insurance industry are expanding beyond marketing and intelligent advertising strategies. Mining social media data increases risk management for P&C insurers, bolsters resources for fraud prevention, and unlocks entirely new consumer experiences. Insurance technology can also exploit social media for fraud investigations. Insurers may look at the insured’s social behavior and equate it to records of claims, finding any inconsistencies.
• Telematics: Telematics technologies will continue to impact auto policies. Think of telematics in insurance technology like wearable devices for your vehicle. Cars fitted with tracking tools — thinks Progressive’s Snapshot — track various indicators such as pace, venue, incident, and more, all of which are monitored and analyzed using analytics software to assess your policy prime. For both insurers and insured are the advantages of telematics various. Telematics in P&C insurance can promote improved driving habits, lower insurance premium rates, and shift the insurer from reactive to constructive to the consumer relationships. Telematics has various advantages for insurers as well as for insured’s. Telematics in P&C insurance should promote healthier driving practices, lower insurance premium rates, and move the insurer from reactive to constructive to customer relations.
• Chatbots: According to some estimates, chatbots will dominate 95% of all customer interactions by 2025. Using AI and machine learning, chatbots will communicate effortlessly with clients, saving everyone in an operational time–and eventually saving money for insurance companies. A bot will guide a customer through a process of implementing policies or claims, reserving human interaction for more complex situations.
• Drones: Unmanned drones are an insurance-technology device that insurers will use more in the coming years. They can be used in several phases of the insurance lifecycle–gathering data to quantify risk before implementing a policy, helping with preventive maintenance, and determining loss after loss. Farmers insurance is a perfect example, as they deploy drones to assist household risk management and damage assessment. Such drones carry out roof inspections and other tests, and the drones forward their data for review to the cloud. This is yet another instance in the insurance industry, where IoT and other innovations work together.
P&C insurers are also on the lookout for the new and most significant insurance product advancements. Not only does it help them stay ahead of their rivals, but it also provides the experiences that consumers want in the competitive market. With all the innovation that has been on the market in recent years, from smart home technology to insurtechs and micro-services, it will be fascinating to watch for insurance technology developments.