- InsurTech represents fundamental forces of data, analytics and technology advancements
- Technological innovations are helping insurance processes
- Guy Carpenter is taking deep and comprehensive approach to help clients make the best decision
(Re)insurers are facing unprecedented challenges, risks and opportunities as InsurTech alters corporate dynamics, ways of doing business and customer landscapes; new and unforeseen competitors emerge every day. Companies need to evaluate the demands around assessing how their businesses should automate – and also understand how they need to redesign their infrastructures and processes, according to Claude Yoder, Global Head of Innovation and Product Development, Guy Carpenter.
“InsurTech represents the fundamental forces of data, analytics and technology (DAT) advancements pointed at improving the insurance landscape – the qualities of InsurTech will be with us well into the future,” Yoder says. “InsurTech also represents the increasingly compelling startup community that grows by 150–200 companies per year. These new firms are striving to change the ways in which insurance is transacted.”
Startup firms are increasingly looking to partner with the industry – by most accounts, less than 50 of the more than 2,000 startup firms are “full stack carrier” models. InsurTech has compelling offerings across the insurance value chain – from customer interaction to underwriting and claims there are new capabilities to be considered.
“Many of the startup entities started where there was more data; largely on the life and health side of the industry. Over time, as data sources grew and analytics approaches matured, startups now play across all lines of business,” Yoder explains. “Many of the underlying capabilities of InsurTech firms such as machine learning, voice recognition and natural language processing are insurance product-agnostic – new capabilities that leverage DAT do not necessarily identify themselves as uniquely insurance-related, let alone as product-specific. The new landscape created through startups and their innovative use of DAT consider the nature of transactions generally and how to improve them.”
According to Yoder, one of the most interesting dynamics driving change in the industry is that of the new iGeneration. The expectations of this group of post-Millennials for any form of transaction – from personal to business – are very different even from today’s 25-year old, let alone an older insurance purchaser. As the iGeneration enters the workforce now and in the coming three to five years, new approaches and technology will be used and created to address this group’s expectations.
“In addition to the new iGeneration creating interesting dynamics for the industry, other data and analytics forces are setting the stage for opportunities. In terms of new data sources, sensors and the Internet of Things are generating data about the nature of exposures,” he continues. “With telematics, wearables and property sensors for example, a variety of product lines (auto, workers compensation and property) are capable of receiving data to help underwriting and loss control. For example, auto-based telematics sensors have been around for many years but are being reimagined as not only on-board devices attached to the car, but also as phones used as a means for transmitting driver behavior and health data.”
Analytics continues to advance with machine learning taking center stage as the latest in “here now” innovations. “Machine learning carries into the insurance realm via applications for identifying property exposures such as roof type, pool, trampoline and encroaching vegetation, for example. The ability to configure unstructured data sources such as images has never been greater, in large part due to machine learning,” believes Yoder.
With GC Genesis, Guy Carpenter is taking a deep and comprehensive approach to helping clients make optimal decisions that enable profitable growth as they navigate the InsurTech space. GC Genesis employs a set of complementary services to allow clients to navigate and ultimately use InsurTech to accelerate and de-risk their own strategic journey. Yoder concludes, “Our innovative complementary service to GC Genesis, the InsurTech Alliance, includes a fitting process that focuses on clients’ specific strategic goals and current capabilities and the InsurTech solution most likely to accelerate strategic execution. Next, we perform comprehensive research and technical evaluation of startup capabilities in order to find the right partners, followed by validation, testing and deployment support.”
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