Experts weigh in on everything from dog-related property damage and real-time motor policies to automated life insurance
The InsurTech space is experiencing a boom on both the investment and innovation fronts, disrupting the old, traditional players of the insurance industry who are often perceived to be slow and inflexible. In fact, InsurTech investment topped £5 billion in 2020 to reach record-high levels, despite a year rocked by global pandemic disruption that saw underwriting floors shuttered and court challenges over Business Interruption insurance payouts for Covid-19.
The mass shift to remote working and operations has accelerated many insurers’ long-term digital transformation plans, and agile InsurTech startups such as Wrisk and Cazana offer digital solutions to many of the remote challenges posed by the industry’s legacy systems.
With over 300 investment deals completed last year, here’s our top six stories and predictions from the most promising InsurTech companies shaking up the industry:
- Big tech and smaller tech startups will push their way into this traditional market
Global technology consultancy Capgemini has released the newest World InsurTech report, and predicts competition in the insurance industry will broaden and intensify as ‘BigTechs’ and other non-traditional players enter the market to compete with established insurers. KPMG adds that InsurTech companies and insurance carriers may form a natural alliance as carriers look to partner with technology experts to modernise their infrastructure and adjust to the ‘new norm’ of remote working.
- Blockchain enables startups to offer targeted insurance services
InsurTech startups using blockchain to underpin their digital offerings are helping insurers to break into new markets and offer policies to small, highly targeted sections of the population – the low admin costs associated with blockchain provide the opportunity to branch out into areas such as microinsurance.
- CX, CX and more CX required
The pandemic disruption has had a lasting long-term impact on InsurTech investment priorities, says Deloitte, with the bulk of investment money pouring into technology to enhance virtual customer engagement and cut out inefficiencies in the claims process. Indeed, our own multinational client in the AI contact center space has focused on helping companies use digital solutions throughout the pandemic to maintain first-class remote CX, signing a recent deal to deploy this advanced technology with a UK-based broker.
- Pandemic has driven demand for life insurance policies
InsurTech firms that are agile enough to deploy advanced technologies such as automated underwriting are well-placed to benefit from the post-COVID consumer demand for rapid life insurance products – an area many traditional insurers are unequipped to provide a modern, fully digital service.
- Collecting driver behavior data to personalise policies
Many InsurTech agreements tied up in late 2020 are looking to shake up data-driven insurance policies – a December deal between Zego and Drivit is looking to bring highly personalised motor insurance policies to the market, influenced by real-time capture of behavioural driver data.
- Traditional insurers having a ‘ruff’ time dealing with lockdown pet claims
Many InsurTech providers, such as leading UK company Bought By Many, are applying data-driven processes to specialist areas such as pet insurance – a savvy market move given the boom in new pets during the UK lockdown – and the subsequent rise in property damage claims caused by dogs and cats locked down by the lockdown!
With insurers and brokers spanning North America, Europe and the Asia-Pacific crying out for smarter, more effective digital solutions to their day-to-day operations, there are rich opportunities for InsurTech providers to satisfy this thirst for industry-specific technology – provided they have the knowledge and expertise to establish a brand presence in target geographies and build lasting relationships with trade media.
Simon Woolley is PR Account Manager at IBA International.