09/05/2019 InsurTech, Opportunity and Risk.

The insurance industry stands on the cusp of a philosophical revolution. The adoption of InsurTech principles; using big data and leading-edge technology to reduce risk and maximise efficiency in policy delivery, is high on the agenda of most insurers even if many are yet to fully grasp the opportunities and risks inherent in their application.

Opportunity
A recent report published by KPMG, highlighting some of the expected impact of InsurTech in the next 12 months, predicts some significant changes affecting the way insurers do business. Big Data has the potential to disrupt many aspects of the traditional insurance process, where both claimant and claim data analysis on an unprecedented scale will be used to help insurers make intelligent policy choices.

This will perhaps become most apparent through the design and delivery of niche insurance products; products designed or further refined to compete in a subset of the marketplace where traditionally specific data has been harder to identify. This will include a broader choice of dedicated cover for those at high-risk due to specific health conditions, professions or activities as insurers, and more agile newcomers into the market, fully harness the power of big data and the digital consumer.

Digital Me
For accident and health insurance, data gathered by wearable technology, such as fitness trackers and smart watches may have a role to play in the positioning of products. An individual policyholder’s personal health and lifestyle data compared against matching traits of actual claimants with the evolving ‘digital me’ society; big data in the form of detailed customer profiling, can provide insurers with a more advanced way to calculate the risk of a claim.

Of course, whilst this vision of tomorrow, although within our technological reach, is still some way off for most insurers, as mentioned in a recent article on Rightpath’s own history of leading-edge innovation (available here) the majority of insurers do not have the time or budget to make a concerted large-scale commitment to InsurTech.

The Biggest Risk
The biggest risk lies not in the application of InsurTech but in an insurer’s ability to react to it. In stark terms InsurTech and all the innovations the terminology heralds, such as Big Data, AI and automation in insurance, can be seen something to be adopted or to be competed with.

In truth, for insurers there is a balance to be sought and each step towards an AI/Big Data integrated business model carefully considered. The benefits of a fully-embraced InsurTech strategy must be felt by the consumer; through more competitive pricing, simpler application and claims processing, and the seamless integration with offline processes and customer engagement.

This sea-change is already underway for most insurers, either as a result of in-house readiness or witnessed in the rise of a competitor as a successful early-adopter.

The Customer
Customer satisfaction is key, just as it always has been. No amount of technological innovation can or should override the industry’s strive for the perfect customer journey. Customers are entitled to expect the very best from their insurer, they anticipate that their policy issuer is there to support them, and they have a right to speak out when insurers, brokers, or claims managers fall short of those expectations.

Rightpath’s Claims Managers achieved an overall customer satisfaction score of 90% in the last 12 months (based on robust internal customer satisfaction monitoring), an achievement made possible through the human values of professionalism and friendliness. InsurTech, and Rightpath’s own first-party innovations, offer new ways in which this important metric can be measured and put to good use, as part of a positive cycle which motivates insurers to put the customer at the very centre of every business decision.

In conclusion, InsurTech like any other revolution is threat, opportunity, and for the people; the customers themselves who will continue to shape and determine tomorrow’s prosperous insurers, one policy at a time.

For more information on Rightpath Claims' claims management and administration service, please visit: www.rpclaims.com or call James Fanthorpe, Marketing Manager on: 01268 214096