The insurance sector is not new to technology integration. According to a recent survey by Accenture, insurance executives say that their organization’s business and technology strategies are becoming inseparable, some have even said indistinguishable. Today, acquiring an insurance quote as simple as pressing a button, coverage can be achieved by using a mobile app, and paper insurance cards have become obsolete.
The insurance sector is set to expand even more, with the P&C insurance industry changing with it. This change is driven by digital insurance offerings and a defined omnichannel approach to customer service. This website expands on the P&C insurance industry and P&C licensing. The three following trends have been incorporated by some insurance carriers and will continue to dominate the insurance sector.
- Artificial Intelligence (AI)
AI is ever changing as it is still in its developing stages, and is projected to grow into a $190 billion industry by 2025 while creating 9% of new US jobs. AI is known for its dominance in image and speech recognition, navigation apps, smartphone personal assistants, and ride-sharing apps, with the worldwide spend on these technologies being roughly $47 billion in 2020. A PwC forecast has found that AIs initial impact on the insurance sector will be to improve efficiencies and to automate customer-facing underwriting and claims processes. Once this has been done, AI is projected to identify, assess, and underwrite emerging risks and identify new revenue sources.
AI can be used by insurers to create a personalized experience for consumers for which they crave. This is vital when consumers purchase P&C insurance. To do so, insurers access and use the available consumer data to create personalized experiences based on a consumer’s behavior and habits. Additionally, insurers can use AI to speed up claims processes. By doing so, they would ensure customer satisfaction and would fundamentally change the underwriting process. Seeing that AI is able to eliminate the human element, it provides more accurate reporting in a shorter time period which, in turn, provides faster data access to insurers.
- Machine Learning
The insurance technology trends aim to improve accuracy, and machine learning is one of these trends. According to a SMA survey, 66% of P&C insurance executives believe that machine learning has a high impact potential for commercial lines of business. The survey also found that 53% of executives believe that machine learning has a high impact potential for personal lines.
Machine learning, being a branch of AI which is more specific, is a form of technology which serves to process data and learn on its own without needing the assistance and supervision of humans. If this is successful, machine learning will be able to automate and improve on claims processing. Machine learning will use pre-programmed algorithms to analyze files which are accessible via the cloud. The end result will be faster processing speed and improved accuracy because the human element has been removed.
- Blockchain Data
Blockchain data is a distributed, peer-to-peer ledger of records, referred to as blocks, which are incorruptible. The blocks form a chain by linking to a previous block, and all blocks have a time and date stamp. Blockchain data is self-managed and does not need coordination or human intervention.
Not many insurers have made use of blockchain data, but it is projected to dominate technology integrated in the insurance sectors. Blockchain data has been projected to have an impact on consumer trust, it has been said to be able to enhance efficiencies, and will be able to improve claims processing. Additionally, blockchain data will be able to prevent and detect fraud which will be an extremely useful advantage. Blockchain data has provided a $5 billion opportunity for P&C insurers. Blockchain data has been projected to largely improve cybersecurity in the sector, seeing that insurance providers will be able to use blockchain data to form contracts which are automatically executed.
The takeaway
To compete with competitors, insurers in the P&C industry will always be determined to incorporate the new developments in technology which could benefit the insurance sector. This also provides an excellent customer experience and customer satisfaction, which, in turn, provides a loyal customer base.
