Insurance is experiencing a technological revolution throughout its entire value chain, says FinTechNZ General Manager, James Brown.
Insurtech refers to types of new technology that are disrupting the insurance industry.
Brown says insurtech can impact many areas such as distribution (eg. digital sales, aggregators), fraud detection, policy pricing and claims assessment.
“Some of these insurtech companies are focussed on massive disruption and these companies could replace risk advisers to a degree,” he said. “But many companies are more focussed on enablement which is around helping incumbent insurers and advisers do their job better.”
“Historically insurance companies have lagged other financial services segments with regard to investment in technology and in providing customer-centric tech solutions, however, we are now seeing this change with a huge amount of investment ($ billions) going into this area globally,” he told RiskinfoNZ.
“…many companies are more focussed on enablement which is around helping incumbent insurers and advisers do their job better.”
Zia Zaman, MetLife Asia Chief Innovation Officer and CEO of its innovation centre, LumenLab, says a few thousand insurtech startups have emerged over the last four years.
“The goal of these startups is to either collaborate with or potentially reimagine the insurance industry,” Zaman told RiskinfoNZ.
“The vast majority of them look at the way in which the insurance industry is working today and they take a very narrow slice of that value chain if you will and they see how they can do things a little bit better – either from a customer perspective to reduce some friction; from an operations perspective to reduce cost or to make it simpler; or from an underwriting perspective just to make it more modern.”
He said independent advisers will find opportunities if they think about how the traditional insurance offer could evolve over the next three to five years to give their customers more value.
Insurtech is already changing the industry in three ways, Zaman explained:
- By reducing friction to make life easier for clients
- Creating new risk pools that could be covered using insurtech
- Personalising cover to specific conditions of the individual, particularly in health insurance.
The Australian and New Zealand Institute of Insurance and Finance’s (ANZIIF) Insurtech Conference was recently held in Sydney on 3 May.
“Insurtech is changing the landscape of the insurance industry and early adopters will be the ones who benefit most.”
ANZIIF chief executive, Prue Willsford, says the 2018 Conference had an outstanding turnout.
“Insurtech is changing the landscape of the insurance industry and early adopters will be the ones who benefit most,” she said.
“Genuine innovation, cultural change and strategic partnerships will help the industry move forward. The emergence of insurtech provides us with the opportunity to more closely align with the tech industry in order to better meet customer expectations in the digital age.”