The world is changing fast and no industry is immune to the pressure to evolve, upgrade and innovate. Mass digitization, artificial intelligence, machine learning, climate change, and the rise of financial-based cybercrime are all having an impact on the business arena.
At the same time, consumer expectations have changed dramatically fueled to provide instant access to products and services. In considering these changes, it becomes clear that no industry can afford to stand still. Not even a traditional, robust, and stable one like the insurance industry.
2020 was marked by a drastic redirection of insurance industry resources in response to the COVID-19 pandemic. Then came 2021, when insurers focused on pandemic recovery and meeting customer expectations for digitization and personalization. 2022 will take the industry even further with an emphasis on hyper-personalization and data-driven ecosystems.
The adoption of any new insurance technology should be a top-down exercise and C-suite must lead the effort. From underwriting and claims to the customer journey and distribution methods, here are the top insurance technology trends that can be beneficial in 2022.
Predictive Analytics
Predictive analytics is used by many insurers to collect a variety of data to help them understand and predict customer behavior. However, there are new ways it can be utilized to improve the accuracy of data.
In 2022, insurance companies can use predictive analytics for:
- Pricing and risk selection
- Identifying customers at risk of cancellation
- Identifying risk of fraud
- Triaging claims
- Identifying outlier claims
- Anticipating trends
Adopting predictive modeling tactics has also proved to increase revenues and accuracy for many insurers.
Automated Underwriting
It was once common for insureds to undergo in-person evaluations in traditional underwriting. However, this proved a challenge during the pandemic, and many insurers had to embrace new underwriting methods.
The goal of automated underwriting is to streamline information-gathering and reduce as many human touchpoints as possible. Automated underwriting uses tools and techniques like robotic process automation and artificial intelligence to import and correct data, assess risk, and determine how much coverage a client should get and how much they should pay in premiums.
Extended Reality (XR) Insurance Technology
The launch of the Metaverse got many businesses and insurance companies thinking about using extended reality to their advantage.
XR insurance technologies are changing how companies interact with society, and many insurers use them to their advantage.
The Franklin Institute defines extended reality as using Augmented Reality (AR), Virtual Reality (VR), and Mixed Reality (MR), to offer and make more additional information about our environment clearer by enhancing our senses or to enable unnatural experiences through artificial intelligence.
XR technologies provide insurers with an opportunity to transform and improve many aspects of their business, such as:
- Training
- Risk assessment
- Face-to-face interactions
Applied Artificial Intelligence
At present, very few insurance carriers are harnessing AI to its full potential. However, 65% of insurance agencies believe that AI investments in customer experience (CX) have lived up to expectations. 49% believe that improvements in internal decision-making have likewise met expectations. And, 45% say the same about innovation in products and services.
As the technology matures, AI is bound to diversify and find deeper and more meaningful applications to augment business capabilities. As a result, it will continue to reengineer algorithms and core processes to make insurance more predictive and intuitive.
Make Mobile Apps Future-ready
With Mobile Apps making it easier to access customer location and vital data, pitching customized premiums has become easier. Simultaneously, on-the-field interactions have become more efficient with Relationship Managers (RMs) offering better clarity into the product’s features through tablets.
To Conclude
A number of high-impact business trends are shaping and reshaping the insurance industry as we speak. To achieve the winning edge, insurance companies need to transform themselves by adopting agile technologies that will help them rapidly, seamlessly, and effectively meet new challenges as they arise.
Also read: Use Password Manager To Combat Cyber Attacks in 2022
