Claude Yoder, Global Chief Innovation and Product Development Officer
Insurtech’s impact on the insurance industry is surging, reminding us of the influence that technological change and growth bring to the modern consumer and business landscapes and individual industries – the development of fintech within financial services being an example.
To gain the advantages promised, as insurtech offerings proliferate, companies need to know the opportunities afforded; know their own strengths and capabilities for engagement; and know their clients’ needs and expectations.
The right insurtech investment decisions can bring potential value-add opportunities to many areas including The Internet of Things (IoT), infrastructure, artificial intelligence, robotics, machine learning and data ingestion. Similarly, fundamental aspects of insurance operations – claims, underwriting, policy administration, customer experience, operations, call centers and marketing, have all been influenced by the exponential rise of technology. Insurtech has significant potential to be deployed as part of a business model where companies have deeper “touchpoints” with consumers.
The insurtech marketplace is expanding through new startups and existing companies that are gaining a deeper understanding of both the incremental and the transformational potential of insurtech. Its reach is increasingly broad and is the evolutionary next step for insurance through the combination of data, analytics and technology (DAT) in new and innovative ways. DAT supports services and capabilities that allow the industry to more efficiently and effectively drive down costs and increase client value.
The most valuable insurtech capabilities incorporate all three components of DAT in order to:
- more effectively use available data;
- create new insights through advanced analytics; and
- serve output to users through mobile-enabled technology.
Is data the hard part?
In many ways, the proliferation of data across the modern, connected landscape has driven more innovation than either analytics or technology. Is “having” the data a key consideration for insurtech markets and the larger insurance ecosystem? Some data sources are publically available and easily accessible, while others are clearly proprietary – such as driver behavior captured through a vendor’s telematics application. Capturing information in real time through sensors or mobile devices is the newest process for the collection of data for analytics.
While startups do not have a long history of data, their nimbleness and creativity allow them to collect rich data quickly. Some of these firms are collecting new data through their own applications. With sophisticated analytics, they can also mine the data more effectively to find nuggets of insight that drive solutions. The mining of this data is just one of the ways insurtech firms will gain a foothold in the larger insurance community.
Link to Part II >>
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