In fact, according to 87 percent of respondents to a recent report, technology in the insurance industry is advancing at what they deemed to be an “exponential rate.”
Furthermore, 86 percent of insurance leaders who responded to the study acknowledged that keeping pace with InsurTech advancements was an essential component of staying competitive.
Nearly all the respondents agreed that digital acceleration has had a major impact on core aspects of the insurance industry, and this includes underwriting. In fact, 96 percent reported the belief that InsurTech would be a driving force in the insurance industry for years to come. InsurTech aims to optimize the performance of insurance companies rather than take over the market, as some insurers have feared. Of course, there is no one-size fits all approach to InsurTech solutions. The road to digital acceleration looks different for each company. Focusing on how InsurTech can be implemented for your unique goals is an essential piece of the puzzle.
Data is at the heart of the underwriting process and by harnessing InsurTech, insurers can make this process even more efficient and streamlined. Information from the multitude of devices on the Internet of Things – from aggregated public records to behavioral patterns to wearable tech – can all contribute to a more adaptive and effective insurer. Using artificial intelligence (AI), InsurTech can identify and leverage this data at a rate heretofore unheard of, and, since there are very few sources of applicable data, AI is playing a key role in ensuring this data can be creatively harnessed to optimize underwriting.
The underwriting models of insurance companies are largely a black box in the eyes of consumers. But today, transparency is key to establishing trust and attracting new customers. They want pricing and product information to be upfront and comparable to feel better informed about the choices they make. With online marketplaces, customers can now compare prices and benefits side by side, all on one screen. As personalized data becomes more reliable and available, more and more of the underwriting process itself can now be automated. This trend towards complete underwriting automation creates an opportunity for the elimination of the traditional distribution channels. Speeding up the process can also have a heavy impact on a consumer’s likelihood to purchase. Thanks to emerging technologies, using richer customer data to drive intelligent decision-making coupled with a burgeoning investment in content to deliver rich experiences, insurers can now harness personalized journeys that satisfy consumers while simultaneously strengthening business performance.
Not only this, but the automation of underwriting can result in significant savings that increase year over year as the decision models continue to harness property data as well as data intelligence to further optimize underwriting. This type of deep learning not only drives loss cost avoidance but can also pave the way to more accurate assessments and cost savings from labor and vendor management efficiencies.