The Future of the Insurance Industry

 

The insurance industry is one of the largest in the world with revenues totaling approximately $4 trillion per year. As with most large industries, the insurance world has been hesitant to give in completely to technology for fear that one simple mistake could set off a catastrophic chain reaction. But over the past few years, the insurance industry has been using new technology more and more to the point where the future of insurance looks to rely heavily on technology.

Big Data

In recent years, the ability to collect data that a corresponds to people’s life choices and consumer preferences has been growing rapidly. Marketing experts use this data to streamline their marketing campaigns to target only audiences that would have a definite need for a particular product or service.

For insurance companies, collecting big data means learning how people live and better understanding the risks people face. This will allow companies to offer customized policies for individual customers and offer discounts to customers based on their own personal abilities to avoid risk.

Artificial Intelligence (AI)

The biggest benefit of utilizing artificial intelligence (AI) is helping insurance companies to become more efficient and streamlined in their business operations. Years ago, the idea of allowing a computer to underwrite a policy was unheard of. But today, AI is making it possible for computers to replace humans in many aspects of the insurance industry, and this is going to make insurance companies more efficient. The use of AI is also going to help speed up claims processes and make it easier for policy owners to get their check after a claim has been filed.

Blockchain Technology

When most people think of blockchain technology, they think of Bitcoin and other crypto currencies. But the idea of a blockchain is something that could change insurance and many other industries. In the insurance industry, the idea of a full electronic ledger with all of a person’s data on it could cut down on application times, claim times, administration costs, and almost eliminate the errors that currently plague the insurance industry. This is all still in the early stages of development, but it is something to look for in the future.

Other Technological Innovations On The Horizon

Many insurance companies are experimenting with claims done without any human involvement (except for the client) at all. This is where AI can help to expand the capabilities of an insurance app and make an insurance company more profitable.

There is technology in development that could help to cut out the many middlemen that exist in insurance and bring a more cost-effective solution to agents and customers. With advances in big data and AI, it may be possible to cut out underwriters and brokers to allow agents to deal more directly with customers.

The future in any industry is tied directly to advances in technology. In insurance, there is a great deal of innovation going on in the way of cutting out inefficient processes and streamlining all insurance systems. This could mean lower costs to insurers and, inevitably, lower premiums for customers.