Top Tech Trends Transforming The Insurance Industry
In the past few years, the emergence of core technology trends has impacted nearly every industry – and the insurance industry, for one, has never been riper for disruption than it is today.
Not to mention the many Insurtech startups, like Air Doctor, are leading with their technology-first approaches to shake up and redefine the industry forever – from augmenting legacy systems, low-code/no-code developments, and tailored digital products. And it’s far from over. More and more, the industry is shifting towards an automated, infinitely scalable, and lightning-fast territory – here are the top tech trends transforming the insurance industry forever.
One of the most noticeable tech trends within the normalization of low-code/no-code development is the enterprise IT – tech specifically designed to meet the demands of large organizations. While there was an apparent uptick of no-code/low-code projects in the SMB segment, many enterprises mostly continued to employ traditional development methods.
But this too is quickly changing. As vendors are offering more mature, enterprise-grade no-code tools geared towards security and compliance – meaning these enterprises can let vendors do the heavy lifting and still ensure high-quality security and compliance standards.
Since tools like this can free up internal resources, reduce backlogs, and increase productivity, they’ve become prevalent among IT teams. Perhaps the thing that makes no-code technology so appealing to insurers is the expedited time to market for digital applications and products compared to traditional development projects. Ultimately this technology gives insurers the power to develop software products faster and with better quality.
Augmenting Legacy IT
As new technologies like no-code tools and “headless tech” become more prominent, financial service organizations are able to maintain their legacy systems and improve the customer and employee experience.
Traditionally, insurance has been a conservative industry, but this is now changing with new competition from tech giants, innovative startups, and digital-first insurers. There’s a shift in the mindset of insurance leaders and experts, and the need for innovation is becoming clear to everyone involved. More and more, we are seeing the industry shift from conservative to innovation-focused.
As we near the year’s end, we are clearly headed towards more innovation, better employee and customer experience, increased agility, and innovative applications of existing technologies. As well as slowly leaving behind age-old insurance problems, like risk assessment, claims processing, and policy sales.
Shorter Application Development Cycles
Insurance companies are in a “digital race” as they rush to innovate to support better customer experiences. Agility has become a baseline to mark competitiveness in today’s insurance space. In the past, insurance companies would release new software every six months, or maybe every three months for those in a more aggressive growth stage. And these release cycles would take anywhere between 18 and 24 months. Now tech giants have created a new paradigm where software continuously changes, features evolve rapidly, and products enter the market just as fast as they are thought of. As a result, insurance companies need to focus on cutting application development cycles to shorten the speed to market.
To make this a reality, companies require a significant shift in how they think and build software. This is where low-code platforms that can be changed often or frameworks that allow dynamic changes and can be quickly deployed, rather than being painstakingly coded and then extensively tested. CI/CD (continuous integration and continuous development) will become the new go-to for companies in a future where changing consumer demands necessitate quick and timely software deployments. While many enterprises, including those in the insurance sphere, must accommodate trends like cybersecurity, they should first equip themselves with the capability to change products in the event of market fluctuations.
Quicker Claims Processing
Another thing that can’t be slow on the uptake is claims processing times (the amount of time that passes from the opening to the closing point of a claim). This is fast becoming a crucial distinction between insurers. Those that are winners of the future will use technology to help them speed up processing, almost instantly.
As a result, companies are exploring AI-enabled tools to automate estimation and inspection. One instance of this is using telematics to offer greater levels of contextual information to aid smoother, faster, and more comprehensive claims settlements.
Joint Ventures With InsurTechs
Another growing trend is a collaboration with ecosystem players, as partnerships between InsurTechs and incumbents increase. And for good reason, too – it’s often a win-win situation!
Established insurance companies are harnessing their customer relationships and data to develop new income streams, while innovators provide technical know-how and support. Perhaps the most monumental outcome of these partnerships is the selling of embedded insurance products, which refers to selling insurance products as part of another purchase experience. This has changed how insurance is sold and consumed on a fundamental level. Embedded insurance is rapidly growing, thanks to the widespread use of APIs that offer an easy way to link insurance sales to other customer experiences.
Looking ahead, insurance companies will continue to embrace API technology to make themselves available to a far broader marketplace.
Digital Channel: The New Primary Channel
Prior to the digital age, the physical distribution channels dominated: that of agents or brokers, call centers, offices, and resellers – but now the digital channel is having a profound effect on the way insurance is being sold.
More and more agents and brokers are turning to digital tools; at the same time, customer demand is skyrocketing with the emergence of self-service digital channels. A McKinsey survey conducted in 2020 of European insurance executives, revealed that 89% of respondents expect a significant acceleration in digitization, and most also foresee a further shift in channel mix.
An increasing number of offline processes are migrating to the digital realm. Even products that require some offline execution, like physical signatures and medical underwriting, are transitioning to digital thanks to advances in technology like eSignatures or facial recognition and telemedicine.
The fact of the matter is that inefficient, manual processes have to go. Paper-pushing may have been the norm in the insurance industry for centuries, but this is no longer feasible. These archaic channels cannot be seen as necessary evils anymore, with digital solutions right here under our noses and being normalized more and more each day.
Insurance Through The Digital Looking Glass
While many of these concepts seem to come from the pages of a new science-fiction novel, the technology behind them already exists, and perhaps these innovative offerings are set to go mainstream in the next decade. The insurance industry has been transformed by the inclusion of tech trends and startups – and this transformation will only continue as time goes on. In the near future, the fully tech-enabled insurer will bear little resemblance to today’s organization. These trends, individually and in combination, will have a seismic impact.
To keep up with the times, insurers must adapt their products and processes to innovations. Decision-makers need to assess technological impacts on their companies so they are poised to leverage their potential fully. Business leaders will need to let go of existing ideas and instead embrace a new mindset to remain relevant in what will, in many cases, be a fundamentally different industry.
An Insurtech To Watch: Air Doctor
Air Doctor was launched in Israel in 2018 and connects travelers to a network of over 20,000 doctors across the globe – through an easy-to-use app. Air Doctor is active in 75 countries across the globe and offers both online and in-person consultations with a doctor of their choice.
Air Doctor provides peace of mind for travelers by giving them seamlessly, digital access to multi-lingual medical care; supports global health services through the global outpatient medical network, in addition to providing additional revenue streams for doctors.
Air Doctor has a low integration API, which means insurance providers can seamlessly integrate the platform into their existing systems, the innovative solution reduces costs by up to 30%, ultimately improving the customer experience for insurers.