Insurers contribute to the insurance industry’s growth by digitizing their various operations. Digital insurance operations simplify complex services for the consumers and generate more revenue.
Research and Markets report states that the market value of US digital insurance was $11 billion in 2021. And it may reach $23 billion by 2025 with a CAGR of 20.7% between 2021 and 2025.
Insuretech promises similar growth with technology created to improve the efficiency and customer experience in the insurance industry.
For example, mobile app development services are a branch of insurtech that leads to innovations like live tracking and smart home apps in the insurance sector.
Insurance like property and casualty, health, and automobile insurance needs data accuracy and protection. Cloud Computing, Big Data, and Blockchain technology can provide such all-in-one solutions.
Insurers now recognize the potential of new technology in the insurance industry and how it can make them stand out from the competition.
Technology provides a lucrative deal for both the insurers and the customers. That is why new technologies are quickly getting adopted by many businesses worldwide.
For example, Artificial intelligence is becoming a mainstream trend in many business and financial sectors. According to a survey by PwC, 86% of US companies recognize AI technology as an integral part of their business.
And here are some advantages the latest technology can provide for the insurance industry:
Data Accuracy
A single error in the insurance industry operations can lead to the legally acceptable under-compensation or overcompensation of any customer/client. It can cost the insurance company both money and time.
Artificial intelligence and machine learning can help insurers prevent such expensive consequences.
Technology like Artificial Intelligence, ML, and automation removes the possibility of human errors and ensures complete data accuracy. Such data can process insurance claims designed to benefit both parties.
Utilizing Blockchain helps with data accuracy in financial transactions.
CRM solutions in cloud computing can also help with the accuracy of insurance data as users always come to the same source for information regardless of the device they use to access it.
Data Protection
Top-tier security is an aspect of the insurance industry that helps build customer loyalty and trust. Insurers have to take certain precautions to ensure the security of customer/client data.
Artificial Intelligence and Machine Learning have a user behavior modeling protocol that detects unusual access patterns, high-risk IP addresses, and malware. They also have protocols to counter such security threats quickly after detection.
Customer and insurance company data is always well-protected due to such security protocols.
Insurers also use cloud computing to secure financial and other sensitive data from cybersecurity threats.
Other data security options are antivirus software and Blockchain. They also have top-of-the-line security protocols for data.
Fraud Detection/Prevention
UK insurer Aviva states that insurance fraud increased by 13% in 2021. Both the insurers and customers can commit insurance fraud. The insurance sector always requires a foolproof fraud detection/prevention protocol.
Detecting and preventing fraud requires a quick response that the automating systems of AI & ML can provide. They also notify the concerned parties about fraud instantly for further action.
AI & ML can also interpret a large amount of complex data in a short time. And prevent major insurance fraud before it even happens.
Social media analytics, live-view drones, and cloud computing can improve fraud detection/prevention in the insurance sector.
Faster Claims Processing
Insurance claims processing can be a long and tedious process at times.
Automation technology can speed up this process due to its ability to perform multiple complex tasks with precision and speed. It can simplify claim processing for those who provide accurate and verifiable information.
Automated claims processing is helpful after incidents like accidents, deaths, and natural catastrophes.
Cloud computing can also help with claim processing activity with solutions like claims information collection, progress tracking, and processing transactions.
Improved Customer Care
Customer care service is an integral part of any insurance company. This service can maintain a good relationship between the insurers and the customers. And reliable customer care service also helps in building trust and loyalty.
AI & ML systems can analyze customer data and behavioral patterns to present appropriate solutions for all queries by customers.
These systems can use their exceptional computing abilities to scan a substantial amount of complex data. And find a solution for various customer queries, requests, and complaints.
AI Chatbots can be available 24/7, save money/time, and provide accurate information/solutions to customers.
An insurance company may provide a chatbot and an option to talk to customer care executives for a better customer experience.
Better Data Storage
Data storage can contain sensitive information about customers and insurance companies. More customer data makes it easy for insurers to assess consumer insurance claims. But losing such information can also lead to loss of money and a lack of trust from customers.
Technology like Cloud computing and Big Data can store and manage large amounts of customers/company data. Cloud computing also includes data backup and restore solutions. These solutions can protect insurance companies from the loss of essential information.
Risk Analysis & Prevention
One of the crucial branches of risk analysis and prevention is Predictive Analytics.
It is a process that involves statistics, social media data mining, predictive modeling, Artificial Intelligence, and Machine Learning. Using such technology helps assess and prevent any risks associated with insurance claims processing.
Drones can record customer/client locations and institutions to acquire real-time visual data. Insurers can use this data to conduct a risk assessment for any insurance-related operation.
AI algorithms can compare every new customer data with the well-known or past ones to identify similar cases that led to significant losses or legal problems. It can help insurers prevent many risks like loss of clients, misuse of resources, and a bad reputation.
IoT can also help with risk prevention with options like tracking devices and Smart health monitoring systems.
For example, a life insurance executive can monitor consumer health and inform them about the care or treatment they need to avoid a life-threatening situation. It can help prolong consumer lives and protect the insurance company from unavoidable spending.
Personalized Customer Experience
Insurance companies thrive on their knowledge of customer needs and behavior.
Such knowledge helps them create insurance solutions that can easily capture the attention of potential customers.
AI and ML can study customer data and behavior on insurance company platforms. And personalize specific solutions designed to meet the needs and interests of the customers.
For example, a grocery store owner mostly fears getting robbed, fire accidents, food sickness/contamination lawsuits, and property damage.
AI algorithms can analyze the information and digital behavior of such grocery store owners to create personalized insurance solutions that will cover all such potential losses for them.
Conclusion
The technology and the benefits mentioned above are just the tip of the iceberg compared to what the future technology will bring to the insurance industry. The new developments in AI and IoT happen every day. And the insurance industry will only get more successful due to that.
For example, mobile apps have also simplified and promoted the services of many insurance companies.
Any experienced app development company can design an app that takes complex insurance services and make them as simple as drinking water for customers.
More advanced technology will emerge with time as it improves the insurance industry’s security, reliability, and accessibility.
