Jake Tuff 
Insurtech enables insurers to offer scalable and automated processes related to insuring, helping them to remain competitive in what has been called the ‘datafication’ age. Thanks to ‘insurtech’ technologies, insurers can now more finely calibrate risk models, and tailor policies to clients in ways they could not before.
It’s often appreciated, for instance, when insurers are efficient, when they can be reached when needed, when they are accessible. But customers might sometimes get the impression that insurers don’t have their ‘best interests at heart’.
Artificial Intelligence (AI)
Insurance companies can use AI to operate more efficiently, improve customer communications, and better assess risk. Among the challenges insurers would face is deciding how to use AI – such as selecting the right partners and developing long-term technology roadmaps.
AI helps companies to improve and speed up the processes, reducing human errors that many employees can make Artificial Intelligence helps companies to become more effective with the processes enabling them to deliver products and services tailored to the needs of each customer.
For example, because computer-guided conversations are tailored to a given customer and automated, adopting AI-driven approaches can help to avoid insurer churn. Also, because AI can incorporate dynamic data processes, it can increase customer satisfaction by giving customers the impression that their insurer has things under control and is thinking of them in a timely manner. AI can therefore help to keep insurers competitive in a digitally moving target world.
Machine Learning
Beneath this, machine learning is saving time for human staff by automating manual tasks, for example by iteratively and flexibly dealing with typos in transactions or by automating aspects of fraud-spotting in claims handling. It can also improve customer service, for example by helping insurance firms determine who their most dangerous drivers are so as to offer them cheaper premiums.
C2P insurance enables users to create niche small-ticket products to meet individual customer needs while adding value, such as Cuvva, a car-insurance product that allows users to buy car cover by the hour; or P2P (peer-to-peer) groups, whereby friends can collaborate and self-organise to create flexible groups with a shared deductible and rewards for making the right choices.
Thanks to the freedom of choice given by new regulations, insurance companies are relying more and more on technology assistance to enable consumers to compare with competitor offers in an easy and fast manner.
Robotics
These tools for robotics can assist insurers to automate several operations including the issuance and verification of insurance policy, the verification of claims, the migration of such data and many other insurance transactional activities. Robotics tools can help in enhancing the customer experience and efficiency for insurers.
Telematics can be used to track the profile of a driver (good or bad) and charge them different prices for their car insurance accordingly – a true win-win situation for both parties. In addition, it can help avoid the very risks it detects.
Incumbent insurers are tentatively beginning to embrace digital technologies, but are only just realising that they might be able to profit by partnering with insurtechs – if only they can work out how to get value from those relationships, or risk relinquishing their competitive edge to new rivals coming to take their place.
Blockchain
Alongside this transformation of their business models, big corporates such as insurance companies identified the potential in using Insurtech technology to improve their customers’ experience, as well as strengthen their operational flexibility. With the help of AI, blockchain and Internet of Things (IoT) technology, insurers can improve their risk-evaluation, fraud-prevention, customer-centric services delivery and much more.
Automated rules implemented through blockchain will also let insurers make insurance policies that are quicker and more transparent to underwrite. The underwriting tasks formerly performed by humans could be carried out by such algorithms.
By using blockchain to store data across diverse parties, the insurance industry can capture information about clients and their policies and coverages more securely. It also offers a convenient way to conduct background checks: market competitors or ordinary customers can easily scrutinise the data without each party having to turn to an external evaluation firm. Further, blockchain enables customers to prove their insurance with a few clicks without the need to exchange paper documents between the proof-proving parties and the insurance issuer.
Drones
Carriers that utilise this tech can increase their business and clientele, since younger segments are not as company-loyal as their older counterparts, and they expect to be able to access financial products, including insurance policies, whenever and wherever they choose.
Drones also provide cost-cutting tools during both the pre- and post-loss process, insurer. By using drones as unmanned aerial vehicles (UAVs), inspection of the property risk prior to contracting or renewal of a contract, as well as post-loss processing can be enhanced. Property insurers may use drones when clients file a claim for a loss by fire. They can dispatch (survey) the place of the loss using a drone fitted with a thermal imaging device. In choosing to use drones to assess areas with high loss risk prior to insuring or renewing an existing contract, it has benefits such as minimisation of fraudulent claims due to ease of observation from the sky. Moreover, it reduces loss of property due to fire in the long run. It also saves lives by reducing the need for an employee to inspect an insecure or unsafe property.
