For so long, insurance companies have largely followed the same practices and have managed to be successful without having to change too much. That’s been a good thing for insurers, but it’s also caused some frustration. Insurance companies have often been accused of taking too long to sign people up for insurance and pay out claims.
Enter insurtech. This new technology is slowly but surely transforming the insurance industry and injecting excitement into the way business gets done. The result is a more customer-focused approach that cuts out a lot of the waiting, red tape and hoops needing to be jumped through that customers have previously found frustrating. It’s also opening up new platforms and earning potential for insurers, as well as helping to streamline their operations.
Want to know more? Here are four ways insurtech is already shaking things up.
Person-to-person (P2P) insurance is changing the insurance game. It’s basically a social form of insurance where a group of like-minded individuals (like friends or family) team up to pool their insurance premiums to insure against a particular risk. Unlike traditional insurance, with P2P, if you go a certain period of time without making a claim, then you get some of your money back
Artificial intelligence is providing opportunities galore for insurers to get things done quickly. With AI’s ability to compile and analyse lots of information very quickly, there’s no need for customers to wait for humans to process sometimes complicated information. And as we know, time equals money, and the less time things take, the lesser the costs for insurers and their customers.
Insurance companies have been one of the early explorers of chatbots – robots that take the place of customer service humans 24 hours a day - and how they can transform the customer experience. One UK-based startup — Spixii — has already created a chatbot to sell insurance policies through mobile chat apps. The bot asks the user questions about their insurance needs and then it finds the most appropriate product for the customer without the customer needing to fill in a bunch of forms.
The Internet of Things (IoT) is going to transform the insurance industry in super-exciting ways. IoT (any ‘smart’ device that is connected to the internet) can be used to understand your habits, which will then enable customers to receive more tailored insurance advice and also help prevent costly insurance claims and disruption.
For example, water pipe sensors in the home can send you alerts if a pipe is about to burst so you can get it fixed before you have water everywhere. Telematics in cars can collect info on your driving habits so insurance companies can create insurance pricing that is specific to you, helping to deliver savings and encourage road safety.