The global InsurTech market is projected to grow by $15.63 billion, during the forecast period 2019-2023, according to Technavio. Market experts predict that the use of Big Data and artificial intelligence will propel growth at a CAGR of about 41%. With digital technologies such as embedded analytics, insurers can understand consumer behavior, market patterns, and make informed decisions.
As a result of digitization, companies can improve the functionality of payment and transaction processes. So, if you intend to buy your life insurance on the internet, expect an improved customer experience.
On-Demand Insurance Coverage for Business
Unlike traditional insurers, insurtech startups allow consumers to buy coverage when they need it. For example, business owners can buy worker’s compensation when necessary, based on the number of employees and possible risks. On-demand insurance coverage policies are also easy to access and affordable. There is no paperwork involved, no need to deal with an agent, and no long-term commitments, making workers comp insurance cost-effective compared to traditional commercial coverage.
According to cerity.com, purchasing insurance has been re-imagined because you only need your smartphone to access a quote for employee coverage. You also don’t require physical contact with insurance representatives. Thanks to digitization, businesses pay premiums via an in-app, and file claims with the help of a mobile user interface. Due to the reliance of smartphones, mobile apps, chatbots among entrepreneurs and insurers, and on-demand protection will continue trending.
Chatbots become Popular
Despite chatbots being around for years, they will take the insurance sector by storm. The use of chatbots increases efficiency by solving queries simultaneously. As advanced technologies such as artificial intelligence make bots smarter, their presence in insurance companies will increase. Insurers are investing highly in bots to simplify the task of explaining complex products to consumers, drive company engagement, and improve marketing and sales.
Also, the use of chatbots in insurance companies will go beyond reducing operational costs. With bots, insurers can enhance customer experience, as these applications can provide consumers with answers to their questions faster, accelerate claim processes, and offer quality customer service via online chats.
Enhanced Privacy and Data Security
Using new technology in the insurance market is exciting, but it also presents challenges. As more consumers share information online, privacy will be a top concern. For this reason, policy providers must be ready to adhere to strict standards that protect consumer information.
Insurers will also need to focus on ethics when it comes to the use of AI and customer data to prevent discrimination or built-in bias. The interest of insurance tech startup is to protect customer information, and that will increase regulatory activities like the adoption of emerging trends in cyber insurance.
While trends like budding international markets, non-traditional insurers investing in insurtech, and the threat of climate change are worth watching, Big Data and AI will have a significant impact on the industry. Other trends shaping the global insurtech industry include on-demand insurance, the rise of chatbots, and enhanced consumer privacy and data protection.