The insurance industry has biggest platform for digital transformation in recently. The Insurtech sector those companies in the insurance sector that take advantage of the latest technologies and are committed to innovation and development for the new products or services with the aims of reducing costs, both for clients and insurance companies themselves. It also seeks to improve operational efficiency and enhance the customer experience.

Insurance industry trends 2021

In 2018, various technologies are enabling for creation of customized solutions, with savings and cyber-security taking precedence. These are the technological trends that will shape the insurance sector:

Cloud computing

Cloud architecture improves for the speed and flexibility, allowing organizations to manage of their data without the need for their own infrastructure, simply by taking advantage of the services or tools offered by cloud providers. With the hybrid cloud market expected to reach approximate #128.01 billion by 2025, it’s most important for enterprises to adopt this type of cloud storage to fully leverage the power of their data.

Predictive analytics

Various insurance companies are use to predictive analytics to anticipate possible future customer behavior through data collection. But it isn’t the only thing, because now these companies can use predictive analytics to identify fraud risks, anticipate trends, triage claims, detect customers at risk of cancellation and predict price or more

Impact for the adopting latest models have shown that companies improved their of loss ratios by up to 9 percent and increased their bonuses by up to 53 percent compared to the 18 percent for the market average over the same period.

Artificial Intelligence (AI)

In 2020, the incorporation of Artificial Intelligence businesses and households has been slowly gaining momentum and with the impetus of the pandemic situation.  The process of digitization in insurance companies has accelerated significantly. Although not for various companies invested massively, they will place great emphasis on digital technologies in the coming months.

Artificial Intelligence come the trend of physical robotics. According to Mckinsey, 3D printing will radically reshape manufacturing or commercial insurance for the future. In 2025, the 3D printed buildings will be commonplace and carriers will need to evaluate how this development changes risk assessments in 2030, so much higher proportion of standard vehicles will have autonomous features including self-driving capabilities. Carriers will need to understand how the increasing presence of robotics in everyday life and across industries will change risk pools.

Automation and Machine Learning

According to Forbes, the machine learning will not only improve the claims processing but also automate it. This technology is allows for the digital files to be analyzed by programmed algorithms, improving the speed or accuracy of processing.

Its applications in the insurance sector can be extended to claims, policy administration and risk assessment. An SMA survey is about 66 percent of general insurance executives believe machine learning has much high impact potential for commercial lines of business, while 53 percent of executives believe it has high impact potential for personal lines.

Cyber-security and Block-chain Technology

In previous year has brought to the forefront a concern that was already on the table but is now a necessity: digital security. Remote work and the rise of internet-based services have changed the way of people communicate or access services, making it crucial to focus on improving security in the insurance industry.

With the main premise of fraud detection and risk prevention, blockchain technology is the natural candidate for deployment for the insurance industry. Issuance of insurance policies through smart contracts and encryption for the medical records will make the operations secure or efficient, apart from bringing transparency between the insurers and reinsurers. The increasing incidents of cyber-attacks in the insurance sector make the adoption of block-chain technology essential.

Block-chain technology is going to be one of the industry’s great allies for cyber-security, as insurance providers are going to be able for use this technology to create smart contracts that are automatically executed, which translates into being able to track claims and update conditions.

In the recent report is PwC claims that Block-chain offers about five billion opportunities for insurance companies for damages. This could trigger the transformation of business transactions or information exchange on the one hand and the elimination of costly layers of overhead dedicated to verification on the other. Potential benefits include for the mutually trusted version of the truth, without need for the costly or error-prone manual re-entry of data.

Data ecosystems and open source

For the data becomes more important, open-source protocols will emerge to ensure that data can be shared and used across industries. Insurance companies that don’t want to be left behind need to manage software platforms implement upgrades and go to market with compelling products.

Code tools enable for the companies to fast deploy to user interface functions, as well as doing it at a higher speed while empowering employees and developing pervasive applications.

Chatbots

These automated response systems are increasingly in the recent year on websites in all sectors, ready to perform customer service tasks. In 2025, according to some estimates approximate 95 percent for all the customer interactions will be driven by chatbots. This is a much high percentage for the near future and many insurers are introducing these virtual assistants for their platforms.

These tools mix Artificial Intelligence and Machine Learning are allowing them to interact with the customers in the most human way possible and saving company employee’s time, which also translates into money savings. These bots can guide for the customer through service requests, complaints and answering frequently asked for the questions. Still without replacing for the person in the most complicated cases. 

Internet of Things (IoT)

Following the topic of the great advantages that good data management can bring. Most consumers are willing to share for the more information in exchange for savings of their insurance policies or the IoT automates that data sharing.

These devices can be used as components of smart homes, car sensors and mobile technologies to determine better rates, prevent losses or reduce risk. Markets and Markets forecasts point to the global IoT insurance market value approximate #42.76 billion in 2022, so companies should not miss the opportunity to improve of their revenue or accuracy.

Social networks and data mining

Social media is part of our daily lives for the both privately and professionally or it has also become a more attractive environment for insurance agents to connect with consumers. They are places where you can be inexpensively, creative and where you can engage potential customers.

In addition, beyond for the more marketing side, data mining for social media is improving risk assessment for insurance firms, enhancing fraud detection or enabling the delivery of an entirely new customer experience.