Technology overlaps with every business today, the business of insurance is no exception. Rapid advancements in fields like artificial intelligence and the proliferation of the internet and social media are changing the way the industry does business.
It’s no secret amongst industry insiders that filing a claim today, looks almost the same as it did decades ago. The insurance sector has been notoriously slow to leverage new tech to their benefit, but this is changing. Artificial intelligence and big data have been revolutionary in transforming the way the industry deals with processes and payouts. Touchless claims and chatbots have given insurance companies more opportunity to gather important metrics while providing a fast service, increasing customer satisfaction.
Social media has also helped insurance companies, lowering their marketing costs and providing them new ways to increase their visibility amongst buyers. Today most people find insurance companies on the internet, compare prices and purchase the policy that suits them. Sometimes, and especially with more complex policies, like life or indemnity insurance, customers will use social media to reach out and research prices and policy details and then use this information to work with a local agent or broker. Using social media allows consumers to get quick responses to questions. Insurance companies active on sites like Facebook, or Twitter can provide easy to understand information for consumers, which will lend itself to bringing in more consumers in the long term.
The internet and social have also brought competition from new models. Peer-to-peer insurance and ‘insurtech’ startups have begun arriving on the scene to challenge traditional models of coverage. One of the biggest movers in this area is US based Lemonade, which offers home insurance. The founders built a model which donates all money from unused claims to the charity of the policyholder’s choice.
There’s benefits beyond marketing and speeding up processes. Insurance companies have started using mobile and wearable technology to help consumers save on their premium. Auto-insurers are now using telematics, or BlackBox policies to help save consumers money on their premiums. Likewise, many health insurance companies have embraced the wearable market, offering discounts to those willing to wear a Fitbit or use a smartphone to track their daily activities.
New tech can present opportunities for improving practices and redefining the customer experience, however for the consumer it can result in something of a double-edged sword.
Sometimes the impact is more than just discounts and deals. Social media posts and mobile and wearable technology are being used by insurance companies in auto accidents and general personal injury claims to lower compensation payments, or even outright reject them. Although these technologies can circumvent the traditional limitations of evidence involved in an insurance claim, their accuracy has been called into question. A recent study by Stanford revealed that a wearable device could be off by up to 93%.
The insurance industry has been resisting the push of the technological tide but embracing new ideas and newly developed technology has the potential to completely redefine the customer experience and provide a service that resonates with modern consumers.