Technology has the potential to make the vehicle insurance market more human. Consider that logic for a moment. Insurtech has historically played a role in the industry, but perhaps never more than during the Covid-19 outbreak.
Car insurance businesses have been obliged to reach out to customers through various channels due to lockdowns and social distancing. As a result, they’ve been urged to personalize messaging to meet current needs and streamline cumbersome underwriting procedures. Furthermore, many use artificial intelligence and machine learning to automate data processing.
During this healthcare crisis, the car insurance business as a whole has undergone a five-year digital acceleration. The tendency toward hyper-personalization will almost certainly continue. To fulfill the individual’s specific demands, offerings should be tailored to them.
Will Insurtech make the right advances?
There is a sense of wariness among the customers. It relates to the data that insurers hold on their customers and what they can do with it. These businesses are known for being “data-rich but information deficient.”
Both of these issues may be addressed by an insurtech infusion, which would provide the capabilities to evaluate existing data while also collecting new data. In addition, it has the potential to provide predictive modeling, which would speed up the application and underwriting procedures. This could lead to creating personalized items (i.e., it would likely eliminate the need for things like physicals, in most cases). It could also help insurers save money by increasing efficiency, providing more inexpensive coverage, and lowering expenses. So, there’s the personalization of the industry again — be customer-centric, and everyone will win in the end.
While insurtechs have recently gained more popularity, the trend is not new. The origins of insurtech can be traced back to the Great Recession of 2008. The momentum continued to build from then, with global insurtech investment reaching $4.15 billion six years later, up from $348 million in 2012.
There is no turning back at this point. There shouldn’t be. The following are some recommended practices for vehicle insurance companies that are still catching up with technology:
- Evaluate the overall operation: This entails taking a step back and looking at the complete customer experience – this is where customization can help.
- Make sure everyone is on the same page: This means breaking down silos and synchronizing every aspect of the operation, from underwriting to actuarial work, risk management to compliance.
- Have faith in the process: Digital change takes time, so be aware of that upfront. Mistakes will be made. It will be necessary to make course corrections in the middle of the race. It’s all about keeping the faith and keeping the momentum going.
- Maintain short-term goals: Immediate gains are valuable because they show shareholders and customers that you are on the right track.
Internally, marketing and communications professionals must continue to beat the drum for digital transformation, emphasizing that it is what customers desire and, in some cases, have already experienced in other industries. So why should insurance be any different? They can order almost anything from their phones, even groceries; why should insurance be any different?
The sector is prone to create cultures that are solely focused on technology and operations, emphasizing meeting deadlines and achieving revenue targets. However, there should also be a focus on operationalizing customer-centricity.
Personalization is both necessary and anticipated, and insurtech shows how the sector may achieve it. Strange, right? Will machines bring us closer together? Absolutely. We at Way.com believe that will be the case in the future.