Insurance firms are beginning to change the fundamental essence of insurance because of technology integration. Today's insurtechs address some of the fundamental issues such as the length of claims procedures, and improving the experience of purchasing an insurance policy.
Automation provides speed and better customer experience
Artificial Intelligence expedites claims documentation
Cloud computing aids insurer’s operational efficiency
Telematics determines a person’s risk profile
The pandemic has sped up digital adoption among many insurance firms. Automation, artificial intelligence (AI), cloud computing and telematics were the four trends in the insurance industry.
One of the most potent trends to have developed in recent years is automation. Insurance-related intelligent process automation has shown to be the ideal solution to the problems encountered, during the pandemic. With less dependence on human labour, claims are immediately processed, costs are lower, and it delivers a better overall customer experience.
Implementing automated processes for claims processing, issuing insurance policies based on pre-built robotic process automation (RPA) use cases, and automated underwriting are a few intriguing use cases. As mundane tasks are replaced by automation technology, insurers have more time and resources to focus on giving customers a more individualised experience. RPA may be used to check and authenticate insurance claims and other documents.
Employees at banks deal with a lot of consumer data and the manual procedures are prone to mistakes. As a result, several banks including Axis Bank and Deutsche Bank have utilised RPA to automate business procedures.
Processing unstructured data is one of the most difficult problems that insurers must deal with. AI is being used widely to provide efficient, timely and more streamlined methods. It enables faster claims documentation. The number of clients who are likely to renew their insurance is predicted through the renewal prediction algorithm. This enables insurers to concentrate on clients and boosts the company's renewal rates.
A few insurers are also utilising AI for pre-inspection of automobile insurance, directing clients to click and upload images and videos of their vehicles for real-time damage detection. In the event of flight delays or cancellations, claim reimbursements for travel insurance are automatic.
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Cloud computing has improved the basis of insurance firms by giving a useful delivery model to facilitate or hasten business change. Insurance firms may now fulfil their business application requirements and shorten time-to-market by utilising scalable service delivery methods.
A customer experience and customer journey-focused ecosystem of apps may support core management systems on the public cloud. Businesses may run sophisticated AI models for customer and business-related activities using cloud computing. For insurers, the flexibility of the cloud provides scalability and storage-related functions that aid in more efficient operations.
Six major financial institutions are leveraging Amazon Web Services (AWS)' cloud-based services for automation and rapid scalability for technology-related initiatives. These are JPMorgan Chase, Barclays, HSBC, BBVA, Standard Chartered and Capital One.
Vehicle manufacturers are beginning to adopt telematics, taken from the words ‘telecommunication’ and ‘informatics’. A telematics device that records driving habits and behaviour is now standard equipment in many new cars. If used throughout the ecosystem, this technology can dramatically alter how auto insurance is offered to clients.
The notion of using telematics came from the fact that a person's driving habits are trustworthy criteria for determining a person's insurance premium price. A person's risk profile may be determined using telematics based on driving habits. They can be paid an insurance premium in line with the risk profile. Additionally, it promotes safe driving and road travel.
Insurance firms may provide need-based plans that are advantageous for the insurers in the long run, while providing highly-customised customer care. The gadget records driving information, how and where the car was operated, if it’s within the cities or on highways as well as driving metrics, including speed, distance travelled, acceleration, and breaking patterns. Due to privacy and infrastructure-related worries about collecting and sharing driving-related data throughout the ecosystem, usage-based insurance (UBI) is still in its infancy stage in India.
The most effective strategy to depart from the conventional "one-size-fits-all" approach that insurers have previously used is to integrate technology. In a market where consumer demands and tastes are always changing, implementing the appropriate tech solutions enables a more personalised experience.
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