This blog by Mike Key posted on the Digitalist on July 13th, 2016
For insurers, new technology offers opportunities not possible just a few years ago. These new technologies offer insurers more data and more access to customers.
In return, insurers can leverage this information and technology to transform whole business models and business processes. With innovative thinking insurers are able to better assess risk and provide appropriate coverage.
Bonus: Download the white paper “How Insurers Can Prepare for the Digital Revolution” to learn more about what digital technology has to offer.
It’s critical to understand technological changes driving innovation today. These changes are adding more connectivity among people and things than ever before.
It’s within this connectivity that insurers can find the opportunities for future growth.
This technological change has several key drivers forging innovation in many industries. Here are five trends that are driving digital transformation.
Better information allows insurers to more accurately assess risk, which in turn allows for better coverage options. With an always-connected world, insurers can provide a new array of products and services.Let’s look at some of the areas of connection and how they relate to insurer opportunity.
With sensors installed in vehicles, driving behaviors can be analyzed in real time. Information on accidents and breakdowns is more available.By tracking driving performance, risk selection and prevention are optimized. Insurers can offer “pay as you drive” coverage pricing that includes discounts, incentives, and fees for behavior. Individualized coverage options lead to more profitability.
Connected sensors and monitors keep buildings and people safer than ever. Cameras and sensors can detect intruders, smoke, fire, carbon monoxide, water problems, and other risks. Collected data gives insurers more information about risk. Connectivity lets insurers provide more concierge services in crises and emergencies.Insurers gain in two areas: improved loss ratios and better customer satisfaction in moments of need.
The growing use of wearables and connected devices give users more investment in their health care. Insurers can better analyze behaviors and usage and offer better information on individuals and groups. This actionable information helps with patient care and better management of chronic illnesses. For insurers, there are fewer claims and payouts.
There are ample opportunities for better partnerships due to these technologies. Insurers, providers, sensor makers, and users can develop new collaborations. By sharing data and creating synergies, insurers can find new revenue streams. In turn, insurers can gain market share and profitability.
The technology is here and evolving. Estimates put the number of Internet users worldwide at 3 billion by 2020. Similar estimates put the number of objects in the Internet of Things at 30 billion to 50 billion.For insurers, it’s time to seize on these opportunities and the industry is moving in that direction. A study by Tata Consultancy Services showed that 80 percent of companies that invested in the Internet of Things increased revenue as a result.A KPMG International survey of insurance leaders showed that technology is front of mind for many executives.The survey asked for the top three opportunities over the next two years. The top three responses all spoke to the integration of technology:
It’s clear that the need to innovate is critical for insurers wanting to thrive. Digital technology is leading the way in this innovation. Insurance companies that seize on the opportunities this technology provides are well positioned for a digital future. Insurers need to embrace these technologies and the information they provide to gain better insights that will lead to more profitable product offerings and better decision making.
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
User | Count |
---|---|
12 | |
7 | |
6 | |
4 | |
4 | |
4 | |
3 | |
3 | |
2 | |
2 |