The Future of the Insurance Industry and Risk Management

While insurance may seem to some people like a staid and traditional industry of long-standing, it is in fact extremely subject to digital disruption, competition from startups and the evolution of existing practices, just like virtually all other industries. The largest factors that will drive change in the insurance field include:

Online technologies, including the growing convenience and preference by consumers to compare policies and prices online, and then buy directly from the firm with the best offering.

The Internet of Things (IoT), GPS, wireless communications and artificial intelligence, enabling insurance companies to use advanced technologies to track the behavior, health and locations of insureds, including such activities as driving of cars and trucks (auto insurance) and physical exercise (health insurance). This practice is in its infancy but is already making it possible for insurance firms to offer variable car insurance rates that are influenced by drivers’ behavior, including mileage driven and speed driven relative to local speed limits. Advanced algorithms with limited amounts of artificial intelligence are already making it possible for underwriters to make competitive price offers for life and home insurance based on such factors as credit scores, geography and health records.

In fact, artificial intelligence (AI) is already having very broad implications for insurance firms, making everything from underwriting to policy pricing to claims processing faster and more efficient. AI will be very widely used to determine the desirability and risk associated with individual consumers who apply for everything from auto insurance to life and health, as well as businesses applying for commercial insurance of many types.

The need for all types of specialty insurance policies will also accelerate. New technologies and new types of business, industrial and consumer activities are creating demand for unique insurance, such as policies designed especially for Uber drivers or Airbnb rental homeowners, as well as makers of self-driving cars and related technologies. Elsewhere computer and online activities are driving the need for cyber activity, hacking and identity theft insurance. New fields of business likewise create lucrative opportunities for specialty insurance underwriters, and this trend will continue to grow.

Many other types of technological advancements will quickly create changes in the insurance field. For example, in safety inspections and loss inspections, drones are rapidly being put to use.

In automobile damage claims processing, many leading insurers now enable policy holders to use smartphone-based, automated systems instead of in-person visits. The auto owner takes a photo of the damage, submits the photo and information about the accident via smartphone, and AI (sometimes aided by a human agent) remotely assesses the loss. Practices like this will accelerate, enabling consumers to get faster results while insurance underwriters reduce overhead.

At the same time, new technology utilizes machine learning to quickly and automatically process insurance policy applications. This is referred to as Robotic Process Automation (RPA). Documents are scanned, or forms are filled out by consumers online. RPA then evaluates the information, compares it to benchmarks in a database and rapidly approves policies or marks them for further examination by managers.

Of course, businesses and industries worldwide have learned the hard way that online systems offer an ever-evolving way for fraudsters to steal money. Insurance companies will be utilizing ever-more-sophisticated digital identity, safe customer login and antifraud technologies.

The fastest rates of growth in insurance sales are, and will continue to be, in emerging and rapidly developing nations such as India and Indonesia. This is where much of the future of insurance lies, in finding better ways to package, price and advertise insurance to business and personal lines customers in markets that enjoy rapid rates of growth in the middle class, in the ownership and value of homes and cars, and in the need for retirement and life insurance, as many families, for the first time, find that they have significant levels of assets and income to protect.

Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

Become a Plunkett Research Online subscriber to gain unlimited access to our massive amount of vital industry data and market research.

✔ 100,000 Industry Statistics
✔ 500 Industries Analyzed for Market Size, Profits and Forecasts
✔ 150,000 Industry Executives Profiled
✔ 25,000 Companies Profiled, Ranked and Analyzed
✔ 1,000 Vital Trends Analyzed, totaling 1,000,000 words

Learn More

The Future of the Insurance Industry and Risk Management, Business and Industry Trends Analysis

A Representative List of Organizations that Have Used our Research and Products:

How to access Plunkett Research data.

What data challenge can we help you solve today?

Take a Tour

Contact

Testimonials