Like any other industry, insurance is bound by the constant changes in the greater world. New trends, laws, and technologies all drive advancement and adaptation, with providers and customers looking to make the best of the current situation. While some companies stick to their “tried-and-true” legacy systems, insurtech is a constantly evolving space. Often, new technologies allow companies willing to change to operate faster, smarter, and more efficiently than those stuck with outdated systems.
What Is Insurtech?
As the name suggests, insurtech refers to any technological advancement that is relevant to the insurance industry. This can include anything from claims-processing and compliance tools to database management systems and even custom-developed business applications for insurance providers.
Those outside of the business world often assume that technological advances play the greatest role in more conventionally tech-focused industries like manufacturing and telecommunications. Business leaders, however, recognize the transformative potential of adopting new technologies to streamline and improve all aspects of their internal processes, and the insurance sector is no exception.
Trends in Insurtech
Insurance is a traditionally conservative industry, and many companies — both large and small — rely on set systems and procedures to ensure that they consistently provide customers with predictable, reliable policies and coverage. In spite of this, emerging trends in insurtech are shaping the future of the space, and those who are open to adopting newer, better processes are taking the lead in all areas.
This term may sound like it refers to a corporate lobbying group. But “big data” actually refers to information-gathering processes that focus on increasing “the three Vs” of data: volume, variety, and velocity. By increasing data intake in these critical ways, companies can use the incoming information to create smart systems that are constantly adapting based on new information. As such, big data is the foundation upon which many other important innovations are based.
The most influential and popular application of big data comes in the form of machine learning. Unlike traditional systems, artificial intelligences are programmed to change their processes and operations based on the information they encounter. The more data coming into a system, the greater its ability to “learn” and change its behavior based on these insights.
While many prefer conventional, static systems that simply perform a set of pre-determined actions, intelligent systems have the ability to update their own behavior without the need for human reprogramming. And they’re still relatively easy to leverage. Contrary to dystopian literature on the topic, most AI systems today are confined to a specific task or group of tasks and only modify their behaviors in response to information directly related to their operations.
Some of AI’s most interesting applications come in the form of the Internet of Things (IoT). In IoT systems, a variety of devices and peripheral components are equipped with sensors and connected to a network, allowing them to function as a single interconnected system. And in spite of the use of the word “internet,” no internet connectivity is needed, as this can take place in a closed, private system.
The use of this technology has been demonstrated in industrial settings for a long time. Now, businesses in many other areas have begun to adopt a more connected way of operating, allowing them to seamlessly integrate all of the devices they use.
One of the most significant trends in the future of insurtech is the growing move toward process automation. Perhaps the single most important insurtech innovation of all, automation has the potential to transform data systems and integration, an area identified as a common operational challenge in the non-life run-off insurance market by a staggering 84% of respondents in a recent study.
This means that automation is particularly well-placed to transform data management and integration. Insurance is a famously data-heavy industry, with large volumes of information being collected, processed, and accessed on a daily basis. But effective data management presents a number of significant challenges that need to be overcome in order for insurers to make the most of the information they have.
Automation is industry-agnostic, meaning that it can benefit companies in virtually every sector. Many insurance companies, however, have been slow to adopt automation, instead sticking with legacy systems that they have been using for years. Maintaining these legacy systems may seem like the path of least resistance, but most of the time, they are slow, inefficient, and lack the accuracy of more modern alternatives.
Automated systems not only take the burden of time-consuming data management and federation away from employees, allowing them to focus on less repetitive tasks, but they can also eliminate data silos and errors. This is especially valuable to insurers, who count on their data’s reliability to accept or deny claims.
Other Insuritech Tools
Certain niches of insurance also have more specified tools. Even when pre-existing tools are not available, custom-developed applications can be created to fill precise needs. Focused tools for specific industries provide a platform for agents to complete their most essential functions without getting bogged down in researching the most up-to-date regulations in each state. Even more importantly, they save insurance providers from running afoul of the law in all areas in which they operate.
Stay Ahead of the Insuritech Curve with Populus
Leaders in the insurance industry have already begun adopting process automation solutions, putting them several steps ahead of those who have been slow to implement change. Many organizations are hampered by their reliance on outdated legacy systems and manual processes. Streamlining and optimizing business processes allows companies to reduce costs, maintaining a competitive edge regardless of the overall state of the market.
If you’re interested in implementing insurance automation for your business, Populus can help.
Populus Technology has over 25 years of experience providing technology solutions to our partners. We help support their growth by updating and automating their business processes, even creating custom software solutions for unique workflows. We also offer services to manage IT partnerships and direct our clients to the best third-party vendors in the industry, so they always get the best results for their tech investments.
If you need help transforming your own internal processes, Populus has the solutions you need. Just contact our team today to learn more!