One look at the current insurance industry landscape is all you need to know that technology plays an integral role in this field. However, the degree to which it is utilized can vary considerably.
On one end, traditional, older companies embrace it to the level needed in today’s world, but often don’t go beyond the point where they are comfortable; on the other, InsurTechs and other emerging companies are more or less centered around technology as they look to modernize the industry to meet the demands and expectations of consumers. Then there are the companies that land somewhere in the middle.
Regardless, one thing applies to companies using technology to varying degrees: technology trends impacting insurance will continue to shape 2020 and beyond.
While the trends listed below have been relevant to insurance for some time, they continue to be worth monitoring because the industry will never overhaul itself overnight; slow and steady change is the name of the game in insurance, meaning the five technology trends listed will continue to incrementally change how insurance professionals and companies conduct business in the future.
With this in mind, here are the five technology trends that the Board of Innovation is keeping an eye on in 2020.
- While technology is an undeniable part of the insurance equation, it is especially useless without a talented staff to implement and use it. The issue of attracting young talent, as well as retaining them, is an ongoing issue in the world of insurance. Board of Innovation says this is where InsurTechs can offer a solution. Through partnerships, companies can alter their image to one that is dynamic and able to adapt.
- Customers expect more from all industries, especially insurance. Fortunately, personalization and data are making this much more possible. Nearly everything is connected to the internet these days, meaning data can paint a clearer picture of consumer preferences and more. But data is a thorny issue, especially as the California Consumer Privacy Act and the European Union’s General Data Protection Regulation have become a part of the conversation. Insurers will have to tread a fine line when it comes to data and personalization.
- While more insurance companies are adopting digital strategies, many face hurdles along the way thanks to legacy software and the magnitude of their information technology systems. To successfully digitize, digitalization is also required. According to the Board of Innovation, companies are adopting API or microservices architecture to overcome the complex-legacy-system problem and enable new offerings.
- Artificial Intelligence (AI) and machine learning are beginning to touch nearly every aspect of insurance. But until AI matures fully, a human touch is still needed to help do its work. The Board of Innovation says companies that fail to adopt AI now may find themselves left behind by the time autonomous versions appear.
- Blockchain enables the creation of a digital ledger that can’t be altered. While some in the industry have dismissed it as more hype than reality, it is worth noting that blockchain can help insurers reduce “the admin costs that come with reviewing claims and checking payments made by third parties,” according to the Board of Innovation.
Article By: Denny Jacob
Source: Property Casualty 360