So, do you know what insuretech is? Insuretech simply refers to the various technologies that have an impact on the insurance sector. This technology may be in the form of smartphone applications, claim acceleration tools, automated compliance processors and fitness wearables.
Internet of Things (IoT)
There are many devices that have been adopted in insuretech and they are based on IoT technology. For instance, there are fitness tracking Apps, wearables and vehicle systems that enhance safety, communication and navigation. IoT is certainly playing a key role in insuretech since insurers are relying on the technology to customize communication, minimize risk, data harvesting and improve the experience of customers.
Artificial Intelligence (AI) and Machine learning
AI is crucial in insuretech as it helps in identifying and leveraging data. There are very few sources of applicable data and AI is playing a key role in ensuring the data can be creatively used to develop insurance products. More to that AI is important in enhancing the quality of the products and services offered by insurers. With AI insurers are able to improve: customer acquisition, risk models, marketing and distribution channels. A good scenario of how AI is influencing insuretech is the use of machine learning by the online insurer Zhong An to customize the prices of their products and use data from social media and phone calls to reach out to new consumers.
Chatbots are an important aspect of insuretech as they help improve the customer experience and has the potential of replacing insurance agents. Through bots, insuretech firms are able to establish trust and understanding by ensuring that the low and huge premium policies remain viable to suit the needs of the customers. However, it is important that insuretech firms gauge the customer base before adopting chatbots. By understanding the customers, the insurer can find a bot that perfectly serves the needs of clients based on: culture, age of target market, smartphone penetration rates and level of education.
Just like in other markets, new consumers in the insurance sector prefer to buy products frequently and in small quantities. This is mainly due to the lack of regular streams of income. To satisfy the demands of the consumer, insurers have tailored their products to ensure they are available in small quantities. Insuretech firms need to adopt short term policies that can be paid for daily, weekly or monthly. In addition, firms should consider developing policies that can be accessed on-demand depending on the needs of the consumer. Firms that have adopted an on-demand model involve consumers buying scratch cards or sending short messages to activate their covers. Through this, consumers are able to access insurance help in a timely manner and the insurance firms receive its premiums on time.
P2P is used in various sectors among them financial sector. Peer-to-peer is all about putting individuals into groups so as to benefit from a certain product. By adopting this technology, insurers are able to enhance the security of payments, improve transparency and enable members to connect. To prove how P2P is impacting this sector, companies like Friendsurance are offering customers with the same insurance policy an opportunity to connect. By forming a group, a segment of the premiums is put in a pool where the money is returned to the policyholders at the end of the year if no claims are made.
These technologies are no doubt the future of the insurance industry. By adopting technology, both customers will enjoy products that meet their demands, improved customer experience and protection of new consumers.