The insurance industry has been going through some massive changes since the last few years. It has been gradually inching towards complete digitalization, and people are quite optimistic about the results.
The global insurance market is planning to build a model that would be entirely digital. The benefits of this move are many.
And to corroborate the argument, we have a few points for you to consider. The year 2020 has seen the rise of a few trends, and it can be expected that the trends shall continue well into 2021.
Let us now look at these few trends and see how they are changing the landscape of the insurance sector.
The Trends- In a Nutshell:
Before we move on to divulge more details in the subsequent sections, let us look at the trends in a nutshell.
- There is an upsurge of new models and the growth of personalized products.
- Artificial Intelligence and automated technology shall result in faster claims.
- Advanced Analytics and proactive services are contributing to the development of this sector.
- More InsurTech partnerships are underway.
- The use of blockchain in the insurance sector has given a new dimension to the industry.
Now that we have glanced at the points, we shall move on to discussing them in details over the next few sections.
An Upsurge of New Models and Growth of Personalized Products
The types of insurance models that we have been used to are changing gears. A usage-based and on-demand model is on the rise. More people shall opt for an ‘all-in-one’ product related to insurance policies.
This makes it more convenient for policyholders to access different areas of the policy in one platform. For instance, one can compare and contrast different car insurance quotes to make a quicker and better decision. Besides these, the industry is determined to bring in more relevance to products and make them more personal.
Customers can personalize their requirements and choose products that suit their needs, instead of going for the ‘one-size-fits-all’ idea.
AI and Automated Technology Shall Help in Making Faster Claims
New technologies like Robotic Process Automation and Artificial Intelligence are now helping policyholders to make faster claims.
There is no need to wait for a prolonged period of time before you can claim the coverage. Plus, with these automated technologies taking centre stage in the industry, processes are becoming super-quick.
Another thing to pay attention to is that with the increased use in AI, there shall be a lower risk of fraudulent activities.
Transactions and deals with the customers shall gain more transparency. Therefore, these automated technologies can be assumed to be a game-changer of sorts in the industry.
It is bringing in more efficiency and speed in the claiming process, and shall continue to do so in 2021.
Advanced Analytics Is Helping the Industry Grow Quickly
The third trend that we shall be looking into is the increased use of advanced analytics. The insurance industry is making use of advanced analytics, and this has helped customers to personalize premium rates.
Besides these, cutting-edge technology, like the Internet of Things and various insurance apps, are making things easy for the policyholders. These interconnected and smart technologies are making the industry easy to be navigated.
Drones and different imaging technologies are aiding in the easy and quick analysis. And this is perfecting the industry and making the policies better in every way imaginable. Policyholders, now, do not have to depend on the insurers for information.
They can find things out on their own with the help of advanced analytics, and decide better.
These advanced analytics are helping insurers, on the other side, to understand the preferences of the customers and target them.
More Opportunities for InsurTech Partnerships
The year has seen a steady rise in the InsurTech firms. These are firms that amalgamate insurance policies with technology to provide a better experience.
More and more traditional insurers are now collaborating with technological platforms and coming up with innovative products. This has helped the insurance agencies to identify the pockets of growth and target customers better.
The increased use of technology in the domain of insurance is revolutionizing the industry. InsurTech firms have been reducing operational costs significantly too.
They are bringing in more investors due to the use of fresh technology. And this, in turn, has resulted in the growth of the industry in leaps and bounds. More InsurTech firms are coming into existence with better and more innovative ideas.
And this trend is well expected to continue into the next year.
Blockchain Is Upgrading the Security and Enhancing the Performance of this Sector
The blockchain technology has served as a miracle in the insurance industry. We know that the blockchain has a number of benefits up its sleeves. It started as a medium of transaction for cryptocurrencies.
However, with the passage of time, it forayed into different sectors. Blockchain has now found its utility in the insurance industry as well. Once data of any sort enters into the channel, they become immutable.
They cannot be modified. And this is why there is a decreased risk for hacks and data breaches. Hackers need to alter the algorithm of the blocks to modify data from one block. And that is not an easy task.
The second thing that the blockchain has done is to bring in transparency and speed in transactions and coverage claims. Blockchain has thus, enhanced the industry and visibly so!
There are several instances that have proved how technology has itself useful in the insurance industry.
Most of the trends that we discussed in this article are technological. There is no refuting that technology has been changing the shape of industries in different verticals.
Therefore, it is essential that we view these trends in light of fresh technological innovations. Over the next few years, technology shall only grow and offer us more to deal with. And in that process, the insurance industry, among many others, shall be bettered.
Customers shall have more choices, and they shall be able to make their decisions holistically.