The insurance industry is dynamic, which is why it is still thriving, even in the middle of a global pandemic.
Having been struck by the pandemic, insurance premiums have fallen significantly, but they are set to recover in 2021. This year, many of the trends will be driven by technologies to streamline the insurance process and improve customer satisfaction. Here are 7 tech trends tthat will shape insurance in 2021.
The insurance industry depends on data to function optimally, but new technology has made it possible for insurers to use big data to operate their businesses. The availability of more data means that insurance policies can now be customized to individuals to minimize risks and improve accuracy. Insurers will now be including new data points in their premium and risk assessment calculations.
The industry will experience a surge in the adoption of digital tools for brokers and agents. They will use self-service digital channels to meet the rising consumer demand. Even services that would previously require offline transactions like signatures and medical underwriting for Garrity Insurance policies are now shifting to digitization. New technology like face recognition and eSignatures have facilitated the move.
Cloud computing software such as Software as a Service (SaaS) have been rising steadily over the past few years. 2021 will be the hallmark for cloud computing in insurance because providers now rely heavily on new technologies. Insurers can use cloud technology with agile IT to develop new software and applications that brokers use to utilize big data and interact with clients.
Internet of Things (IoT) offers accurate and real-time data to improve the providers’ ability to assess possible risks. It also allows policyholders to determine the cost of their premiums. Unfortunately, this trend comes with some disadvantages because IoT is real-time, which means that the data will be highly volatile. However, with its demand on the increase, there are likely to be many innovations in the IoT space.
The rise of artificial intelligence technologies implies that many insurance processes will now be automated. This will free up underwriters and insurers and allow them to focus on more important tasks while enhancing efficiency and accuracy. Insurers can use AI software to automate parts of risk assessment, underwriting, and fraud identification procedures. Therefore, machine learning technology will be savvier to the insurance industry with every passing year. The more data the system analyzes, the more emerging patterns it detects and includes in its algorithms.
Insurtech companies make the most out of the latest insurance technologies to minimize costs for the insurers and their customers by enhancing operational efficiency. Although it may sound familiar to what regular insurers are doing, insurtech companies take the technology to the next level. The multi-billion-dollar industry offers predictive data that can be used to enhance the development of customized insurance products.
Although this technology is still in its infancy stages, XR can turn around the insurance industry. Extended reality has the potential of simplifying data collection by making the process safer and faster. That way, investigators can assess the risks involved using a 3D image without accessing the site. New insurers can use XR technology to learn what happens in virtual settings.
Emerging insurance trends point to the need for faster and more efficient systems in the industry. Insurers should be open-minded about how much value AI and other technologies can bring on board. Clients will benefit from the new, improved technologies.