Technologies Affecting the Insurance Industry

By CIOReview | Wednesday, October 20, 2021

Insurance companies will be able to analyze risk with IoT's first-hand data better, providing insureds greater control over policy pricing and increasing accuracy while also increasing income.

FREMONT, CA: It is critical for both carriers and insureds in the Property & Casualty (P&C) market to use cutting-edge insurance technology. The insurance industry's technology is likely to progress significantly by 2021, according to current predictions. Digital insurance services and a well-established omnichannel approach to customer service are accelerating change in the P&C insurance market. To stay ahead of the competition, insurance companies of all sizes are searching for evergreen solutions. Evergreen solutions include technology that can scale and upgrade to meet changing needs as well.

The following insurance technology trends should be considered by insurers seeking a competitive edge.

Internet of Things (IoT)

Most consumers are willing to share more personal information in exchange for lower insurance policies, and the Internet of Things (IoT) will automate much of this data sharing. Insurers may use data from IoT devices like smart home components, car sensors, and wearable technology to help assess prices, reduce risk, and even prevent losses from occurring in the first place.

P&C insurers cannot afford to wait to take advantage of IoT capabilities, as forecasts predict a 42.76 billion dollar global IoT insurance market by 2022. With first-hand data, IoT will bolster other insurance technology, enhancing risk assessment accuracy, giving insureds more power to directly influence policy pricing, and insurers the ability to increase accuracy and revenues.

Insurance Technology (InsurTech)

Insurtech, or more precisely, insurTech companies, use cutting-edge insurance technology to lower costs for consumers and insurers, increase operating performance, and enhance the overall consumer experience. Although insurTech may sound similar to digital insurance offerings that have been around for a while, it brings those capabilities to the next level.

Insurtech investment totaled 4.9 billion dollars in 2018 since insurTech is transforming how real-time and predictive data can be collected and used. That is to facilitate the production of insurance products that are sensitive to emerging risk, allow for tailored coverage and pricing strategies to respond to macro-risks like climate change or cyber risk, and drive potential resilience.