An Insurance Forecast: A Tech Takeover?
Is customer preference and convenience producing a movement in today’s insurance world toward the use of artificial intelligence? COVID-19 has certainty highlighted the advantage of utilizing Insurtech. Shifts in recent months to streamline the insurance industry have shown forecasts and data highlighting these benefits. Let’s take a look at some Insurtech trends that will be prevalent in the future.
According to this article in Policy Advice, “ By 2025, 95% of customer interactions will be powered by chatbots.” Chatbots will not only be able to assist in customer interactions, but also will speed up processing time for claims. Also chatbots give 24/7 access and give customers an app to use for their specific needs which increases customer engagement. Business Insider writes, “Incumbent insurers are using chatbots to transform from passively engaging customers to putting customer engagement at the forefront of their business.”
Just as the customer experience is dramatically changing by the use of chatbots, insurance coverage is also evolving through the influence of Insurtech. When looking to the future, imagine specifically tailored policies for each insured or grouping of individuals with similar policy needs (think cell phone family plan packages). Ultra-customized policy packages will lower the potential of some customers being forced to overpay when they are grouped into certain risk categories. In addition, these tailored packages can include various kinds of tracking programs for individuals to utilize to reduce their premium. Investopedia wrote, “…Insurtech is looking to tackle this data and analysis issue head-on. Using inputs from all manners of devices, including GPS tracking of cars to the activity tackers on our wrists, these companies are building more finely delineated grouping of risk, allowing products to be priced more competitively.”
Smartphone Ease of Access
Insurance business models transforming to incorporate more tech will appeal to the millennial population that has been tracking the insurance industry regarding the ease of smart phone use for purchase and service of policies. Matthew Lawlor and Meghan Alpert note in their article Millennial Consumers and the Insurance Industry, “Only the most responsive companies will be able to capitalize on this new demand for insurance products. Now more than ever, the companies that aggressively challenge the status quo and adapt their quote delivery process to the evolving needs of the marketplace—which now includes millennials—may reap a considerable reward.” Insurtech will help bridge the gap with the younger generations.
The COVID-19 global pandemic has certainly accelerated the insurance industry’s assimilation of tech and innovations into the business. As companies continue to pursue a new future it will be exciting to see how this transformation transitions into reality. Call Jeff Nixon at JL Nixon Consulting to discuss your thoughts.