The insurance industry has witnessed incredible transformation over the past few years. Stakeholders continue to introduce new technologically advanced techniques and methods to help improve customer satisfaction and offer businesses more robust product and service delivery. As new technology emerges in the form of Internet Of Things, Machine Learning, FinTech, and Big Data, the insurance industry is also responding by utilizing these concepts to create new trends.
Introducing new technology is beneficial for the insurer as it reduces costs, improves customer service delivery and detects fraud. Customers will also benefit from it as some of these technologies are built to study consumers behavior, which has led to reduced premiums for many.
Using Big Data to reduce risks
The insurance industry is built and managed on the concept of risk taking. People who fear something bad may happen to them assess their situation and take on an insurance policy, while the insurer offers them cover based on what it will cost to cover the claims in case something happens.
The methods used to assess risks are very complicated and less predictive. Big data is a new science that gathers plenty of data and analyses it using specialized tools. With Big data, insurers will be able to ascertain accurately the possible outcomes of an insurance package using highly predictive modeling techniques. Big data can also be used for fraud detection, customer insights, marketing, and to improve customer experience.
Cloud computing for better product delivery
Servers in the cloud are gradually taking control of the entire data storage industry, and insurance companies are not left out. With cloud computing, insurance companies can reduce IT costs, improve their scalability and collaboration efficiency, and easily access automated updates.
Cloud computing also has more benefits that insurance companies can't resist. It can be used as a scale computing resources to meet periodic demand for financial workload, capture real-time intelligence about accident situations, and to support critical functions like underwriting and billing.
Artificial intelligence build better trust with consumers
Consumers find it harder to trust insurance companies than the manufacturing, banking, and e-commerce industries. The lack of confidence in this context is based on the absence of transparency in the insurance industry. Artificial intelligence systems are now being introduced in all aspects of insurance to improve transparency, check auto insurance quotes comparisons, and elevate customer service experience and products delivery.
Machine learning can be adopted to improve claims management by fast-tracking claims and automating much of the handling process. With their self-learning capabilities, AI systems can quickly adapt to recognize new changes in the system to detect fraud. Artificial intelligence can also be used to monitor customer behavior, which can be used to improve marketing and customer experience.
Internet Of Things
Insurance companies are using Internet Of Things to transform the insurance industry, for the benefit of the insurer and the customers. Using ODB telematics dongle and machine learning, the insurer can judge the behavior of drivers on every journey. Data gathered from the system can be used by the insurance company set prices more accurately on an individual basis. This approach helps insurers make more profit and rewards safer drivers with reduced premiums.
Environmental sensors connected to a data network are now being installed in business environments to detect smoke, fumes, and earthquake motion. Information from IoT devices can also be used to predict possible hazardous events in the future.
Without a doubt, the introduction of these technologies is bound to transform the business insurance environment and open new opportunities for both the insurer and the consumers. The data collected from IoT devices can be fed into machine learning systems to improve predictability and service delivery time, detect fraud, and reduce costs.