enormous potential and enormous risk.
New capabilities like blockchain, driverless
cars and wearables are on the verge of
making major impacts.
Io T is a new growth frontier for the
insurance industry: The global Io T
insurance market will be worth more
than $42 billion by 2022, according to
And as sensors flood everyday
life, telematics offers a new level of
personalized insurance that was never
possible until now. Connected cars bring
new levels of insight to driving habits, offer
advanced driver assistance capabilities
and enhance stolen vehicle recovery.
Connected homes present new frontiers
in monitoring, risk mitigation and rapid
The connected self, through wearable
devices, promises new data on lifestyles
– which have the potential for real-time
monitoring of the physical and emotional
wellbeing of customers and employees.
There’s enormous potential for Io T to
help avoid preventable losses in brand-new ways — a win-win for insurers and
their customers that could reduce both
incidents and payouts.
Advances in artificial intelligence (AI)
are now driving of the value of the Io T
and all the fresh data it harvests: A full
79 percent of insurance executives agree
that AI will revolutionize the way they
receive information from and interact with
customers, according to Accenture.
Improvements in Big Data analytics and
machine learning will pave the way for
greater insurance process automation –
and deliver proactive insights that can help
reduce claims volume by mitigating the
risk of disaster. AI can also enhance the
accuracy of estimates and assessments of
everything from total damage to the level
of coverage required.
and client needs
about the service
provided by insurers.
In a 24/7 digital world, workers and
customers want transparency, flexibility
and control over coverage and claims.
Convenience is key, and access to
information from any location and on any
device is vital for both agents and insureds.
To this end, there are many benefits to
self-service portals with robust and secure
system access. With these tools, agents and
customers can find suitable products with
the right level of coverage by entering just
a few details. What’s more, field claimants
and investigators can facilitate claims
processing by uploading new information,
images and video.
This new level of accessibility also provides
the transparency that modern workers
and clients need. Clarity, after all, is a vital
component of good service and can be an
important factor in regulatory compliance.
But there is still a need for stringent security.
As insurers operate
in an increasingly
world, they must
contend with serious
cybersecurity risks. All collected data must
be carefully protected; data breaches could
seriously damage customer confidence
and negate any opportunity posed by the
Io T. The cyber insurance market is still in
its infancy, so insurers must tread carefully
— and may benefit from sharing data
Recruitment is an important issue for the
insurance industry when you consider
that the number of insurance professionals
aged 55 years and older has increased 74
percent in the last 10 years, according to
the U.S. Bureau of Labor Statistics. By
2018, one-quarter of insurance industry
employees will be within one decade of
retirement. Resources must be allocated to
recruiting and training new staff.
The shortage of skills in the IT sector can
also hamper carriers’ abilities to leverage
Greater economic uncertainty could pose
greater problems for insurers. Possible
taxation changes, interest rate hikes and
new regulatory requirements could all
have an impact. It may be tricky to balance
the needs to take risks and innovate with
maintaining a sound financial foundation.
looks bright for some
The insurance industry
is in flux; someday, we
may look back on 2017
as an inflection point.
It won’t be easy to find the right strategy
that leverages legacy systems and data
while seizing on the opportunities afforded
by new technological advancements. It is
incumbent upon insurers to build new,
customer-driven services and processes
that meet modern expectations — or
risk being swept away by disruptive
Technological advancement is changing
the face of insurance. It’s transforming
the way we interact with customers and
agents, fostering greater operational
efficiency and opening many new potential
lines of business. Some insurers will
inevitably fail to innovate and keep pace
with these rapid changes. But for those
who streamline, differentiate and maintain
a competitive edge, the future looks very