While many companies are experimenting with artificial intelligence, few have successfully implemented it on a large scale.
Carriers will be able to use AI to predictively engineer core processes.
AI will change the way distribution, underwriting, claims, and service work, making them more efficient and allowing for better customer service.
Even though carriers have a lot of data at their disposal, they have not yet figured out how to make use of it all. For instance, they could use claims histories and distribution interactions to their advantage.
AI will be used by leading carriers and ecosystem players to create products and services based on data and analytics.
Many insurers globally have significant amounts of technological debt, with numerous core processes being hindered by numerous aged legacy technologies that are housed on-premise.
As cloud technology matures, more and more insurers are shifting their core systems to the cloud in order to be more nimble in launching new products and creating better customer service.
Cloud computing will also be essential for providing the necessary computing power to make full use of extremely large data sets (such as tens of millions of claims data points).
As ecosystems continue to develop globally, farmers will be best positioned to act as ecosystem orchestrators—acting as a connecting hub among customers, distributors, agricultural tech, healthcare providers, carriers, and reinsurers, among others.
Future of Connectivity The wider adoption of the internet of things could lead to a similar reshaping of product offerings in the life, health, property, and commercial lines insurance markets.
Collecting more data more often from IoT devices helps customers give insurers a more precise idea of their needs and risks, both when they’re buying insurance and afterwards.
5G’s increased popularity makes it possible to share data more quickly, which helps insurance companies provide services to their clients in real time.
Next-Level Process Automation and Virtualization
Robotic process automation has been helping insurers automate processes for many years, but emerging technologies will enable carriers to make major changes to their products and services.
For example, industrial IoT can allow for real-time monitoring of equipment to allow for predictive maintenance before equipment breaks down.
Similarly, digital twins and 3D and 4D printing have the potential to transform the claims experience for all physical damage areas by creating an exact replica of the damaged item.
Insurers handle sensitive customer information across lines, and customers will need to share even more of this information with carriers as products and services continue to evolve.
technologies allow information to be more effectively managed which will in turn allow for a complex analysis of customer data.
This is a necessary component in evolving insurance policies to a “predict and prevent” model. In this model, insurance companies would play a more active role in claims prevention by sharing information more frequently with other parties.
Blockchain technology will make it easier for carriers to manage customer data in a safe and consistent manner, as well as simplifying identity management and verification.
Carriers can create more secure networks by using a zero-trust security model, which assumes that all users and devices are untrustworthy. This approach can protect against cyber intrusions by making it more difficult for attackers to gain access to systems and data.
Enterprise IT is Evolving
Enterprise IT is evolving from a cost center to a strategic enabler. This shift is being driven by the ever-increasing reliance on digital technology by businesses across all industries.
As businesses strive to remain competitive in the digital age, IT must provide the foundation for innovation, agility, and customer engagement.
While in the past insurance companies saw information technology (IT) as a way to cut costs, now it is all about how technology can help organizations drive growth and improve customer engagement.
1. The Rise of Low-Code/No-Code Development in Enterprise IT
One of the most pronounced trends within the enterprise IT is the normalization of low-code/no-code development.
In the SMB segment, no-code tools became the new norm, while enterprises continued to rely on traditional development projects powered by internal resources or external integrators.
As vendors begin to offer more advanced no-code tools that focus on security and compliance, enterprises are starting to shift some of the development burden to line-of-business users while still maintaining governance and control.
Tools that don’t require coding are growing in popularity because they solve some major problems that IT teams face. These tools help amplify internal resources that are stretched thin, reduce backlogs, and improve productivity.
One of the most appealing qualities of no-code tools is that they can help you get new digital applications and products to market faster than traditional development projects.
No-code tools allow insurance companies to create better apps more quickly, improve customer experience, and increase overall service quality.
2. The Continued Rise of the API Economy Some well-known APIs include those provided by Facebook, Twitter, and Google. An Application Programming Interface (API) is a set of rules that dictate how one software interacts with another.
In recent years, there has been an abundance of APIs as businesses attempt to make their data and capabilities available to outside developers. Some well-known APIs are from Facebook, Twitter, and Google.
API’s are allowing Insurance companies to develop new products and services.
Some insurers are using APIs to provide real-time quotes to customers, while others are using them to power chatbots and other digital customer service tools.
As the need for digital integration increases, more and more people will turn to APIs (Application Programming Interfaces) to get the job done.
Many traditional businesses are now looking to allow third-party developers access to their data and systems in order to create new digital experiences and business models.
This need for agility is being driven by the desire for faster time-to-market and the need to tap into new revenue streams.
We are seeing a trend in the insurance industry where more and more insurers are releasing APIs to allow third-party developers to create new apps and services that build on top of their fundamental systems.
In the future, we think that more insurance companies will start using APIs so that they can take advantage of the increasing popularity of insurance products that are available online.
3. The Rise of “Headless Tech”
“Headless technology” refers to devices that don’t have a display screen or interface. Although it might sound a bit strange, this type of technology has been around for quite some time.
Headless websites, on the other hand, don’t have a front-end or a graphical user interface. Whereas traditional websites have a back-end and a front-end as well as a graphical user interface, headless websites don’t have a front-end or a graphical user interface.
Headless tech refers to the trend of separating a website’s front-end presentation layer from its back-end data functionality. This allows insurers to create custom digital experiences for their customers.
This is especially important in insurance because back-end systems often have technological problems that make them incompatible with the modern front-end experiences that customers want.
We will see a trend of customer-facing front-ends and back-end processes being separated, while still allowing data to flow freely between the two.
We predict that insurance companies will increasingly adopt the principle of pay-as-you-go insurance.
4. Hybrid Cloud Architecture is On the Rise The hybrid cloud market is expected to grow to USD 128.01 billion by 2025, at a compound annual growth rate of 18.73% from 2020 to 2025, according to Mordor Intelligence.
More and more organizations are using the hybrid cloud model, which combines the best features of both public and private clouds.
Using hybrid cloud architectures can improve both speed and flexibility for organizations by allowing them to use both their own tools and the cloud providers’ toolkits.
5. The Continued Rise of Customer Data
The increasing volume of customer data being generated presents both a challenge and an opportunity for insurers.
While insurers must find ways to store the increasing amount of data, those that can use the data effectively will have an advantage.
In the future, more insurance companies will use data analytics to get information from customer data. This data can be used to improve the customer’s experience, how the company underwrites, and claims processing.
The rise of no-code tools and headless tech allows financial service organizations to improve the digital experience for customers and employees without having to change their legacy architectures.
6. Delivering Tailored Digital Products
Tailoring products to individual’s needs is something that has been made possible by recent advances in technology like data analytics and machine learning.
In the past, insurers collected data points through customer surveys and other forms of market research.
Now that there is more data available, insurers can get information from a variety of sources, such as social media, the internet, and even wearable devices.
This large amount of data allows insurance companies to develop a much better understanding of their customers and provide products that are much more closely related to their needs.
7. The Growth of Insurance Telematics
Telematics is a technology that allows data to be gathered about a vehicle’s movement. This technology is being used more frequently by insurance companies to collect data about their customers’ driving habits.
Telematic insurance products are becoming more popular because they allow insurers to offer more personalized pricing to customers. These products use data about a customer’s driving habits to assess the risk involved and set prices accordingly.
Telematics can also be used to detect fraudulent behavior, such as if an insured driver deliberately drives in a way that is likely to cause an accident. If this is the case, their insurance policy could be voided.
Tech Trends Matter The following technology trends have the potential to change the insurance industry significantly by altering some of the fundamental components of insurance products and services.
Applied AI and distributed infrastructure may enable automated warehouses, which could fundamentally alter the nature and focus of workers’ compensation coverage by removing the majority of human workers from most warehouse operations.
The effect that these trends will have on insurance will likely be much greater when different technological forces work together and reinforce each other.
An example of this multiplicative effect is distributed infrastructure, trust architecture, and applied AI. These three things combined are transforming how insurers use data to develop predictive insights and policyholder interactions.
For example, new technologies make it easier to detect insurance fraud, which creates significant economic value. Other innovations across the insurance value chain could include new technologies making it easier to detect insurance fraud, which creates significant economic value.
This law states that the effects of new technologies are often overestimated in the short term and underestimated in the long term.
It is difficult to say how much the insurance industry has been affected by recent technological advancements.
The trends referenced have developed quickly and have had a large impact, better than what was estimated.
There are certain trends that are becoming increasingly popular and insurance companies are taking advantage of them to offer new and innovative products and services.
However, many insurers have not updated their technology recently, leaving them vulnerable to being surpassed by more agile companies.
This is a warning for insurance company CEOs to research how recent trends could harm their main products and how they compare to other companies.