For many years, the insurance industry has been shaped by traditional business models. In the digital era, the need to keep up with the trends is more than necessary. To support this digital transformation, emerging technologies are paving their way more and more visibly into the industry.
Actually, 96% of insurance executives report that the pace of innovation in their companies has increased over the past three years due to technological developments.
The Social, Mobile, Analytics, and Cloud (SMAC) technology is already firmly integrated into the fabric of most modern insurance companies. This opens new dimensions of business for them by creating holistic digital ecosystems that allow insurers to provide more personalized customer experiences.
93% of insurance leaders admit to already transforming their business models with the help of artificial intelligence, extended reality, and quantum computing—a.k.a. DARQ technologies. Moreover, seven out of ten insurers believe that, by mixing SMAC and DARQ tools, they will succeed in re-architecting their digital capabilities in the near future.
Data management is highly streamlined through the use of IoT, which almost fully automates the data sharing process. This not only enables insurers to better understand their clients’ needs but also to mitigate risks and prevent losses. As IoT is estimated to reach 20.8 billion devices by the end of this year, it is understandable that investing in this technology can deliver great business outcomes.
“The impact of an increased use of IoT devices is palpable for the ancillary industries in terms of fewer accidents/incidents in auto, home and commercial insurance.” – Head of IT at a large insurance company in Canada
In regards to digital demographics, 84% of insurance executives agree that it opens a new perspective for identifying market opportunities. Understanding the customer’s digital activities and technological identities gives insurance companies in-depth insights into the next generation of customers, as well as into how to meet their modern needs.
Tech-savvy insurers count on the latest technologies to address their digital disruption challenges. Putting innovation at the heart of their strategies, allows them to accelerate business transformation and success. One example of these innovations is blockchain technology.
In an insurance report by Ernst and Young, it is stated that blockchain can “end error, negligence and detect fraud by providing a decentralized digital repository to verify the veracity of customers, policies, and claims independently.”
In other words, blockchain technologies aid insurers in mitigating risk and fraud by digitizing and codifying data, thus providing a high level of transparency and accountability.
The blockchain’s business value-add is estimated to reach $176 billion by the end of 2025. This is great news especially for data security and data storage management.
Wrapping Up
The dawn of the digital era is increasingly impacting the insurance industry, which has to expand its digital capabilities in order to survive. The emergence of new technologies is both a challenge and an opportunity for insurance providers, which are left with only one option: embrace digital transformation. Many companies are already starting to understand how technology can help them address digital disruption and are actively seeking approaches to digitize their businesses.
By doing this, insurance companies are opening a new path to more holistic customer experiences, more agile business models, and a reliable security posture.
