The global insurance landscape has changed since COVID-19 happened to us. The way insurers develop and distribute products to how consumers want to interact with the product has changed.
Insurance companies that want to win today and in the future should understand that activities have moved from the monolithic approach to a more collaborative one. They have to work with others, especially with third parties - technology companies.
The world insurance report released the World Insurtech Report for 2021. The number one thought from the WIR 2021 report is the CARE concept. The CARE shows how insurers should start thinking about their products and services in 2021.
As the product team develop and design products, they should apply the CARE concept by considering the convenience (avoid jargon with the legal terms) of using the product, quick advice (FAQs, Support) on using the product and the product should be reachable (channels).
I read the world insurtech report and tried to make it easy to make sense for you. To read the full report - Check here.
The report breakdown...what you should know.
Reach: More than 30% of customers leverage digital channels to act. What channels do you own? Will it be synchronous or asynchronous?
According to a Gartner 2021 report on the spend on enterprise IT; “The worldwide enterprise IT spending across all industry markets will increase by 4.1% in constant U.S. dollars in 2021 and is expected to have a 6.0% constant currency five-year CAGR in 2020-2025.”
Individuals and businesses purchase insurance to mitigate risks around property loss, health, and family. With the impact of COVID-19, more people are realizing the need for insurance - prioritizing health and safety, financial security, and business security.
The attitudes and behaviours towards insurers have changed.
Pre-pandemic. Insurance companies follow a monolithic approach in offering their product and services to policyholders.
Post pandemic. Policyholders are looking for a frictionless digital experience throughout their journey - the insurance process. They are patronizing insurers that prioritize CARE.
"An insurance policy shouldn’t be written in lagese. It should be simple and easy to understand. You shouldn’t need a lawyer to know what you bought."
Dipak Sahoo, Regional CIO, Asia, Generali, Hong Kong
The implementation of the CARE equation is expected to unlock opportunities across the value chain: from distribution to engagement.
The ever stretching digital ecosystem has been central to the recent adoption and growth in insurance by extending opportunities in coverage for health, life, home, travel and mobility.
As a result, several industry players are actively partnering with insurtechs like Curacel, Octamile, PaddyCover, Lami and others to take advantage of these mutually beneficial opportunities.
A KPMG 2019 article alleged that; "Since 2017, insurance companies and technology companies around the globe have publicly announced more than 180 partnerships. The number of partnerships formed each quarter has been rising as well, from less than 20 in Q1 2017 to more than 30 in Q4 2018.1 We anticipate the actual number, including non-public agreements, to be significantly larger."
Here are some insurance companies that have partnered with insurtechs and platforms to scale up their offerings - reaching more people and delivering better products and services.
API has become key to improving convenience and reach in insurance. API is at the forefront of enabling embedded insurance trends and are strong distribution and ecosystem driver.
AI is one of the cornerstones for improving CARE. A recent forecast predicted a 23% compound annual growth rate (2019 -2024) for AI platform revenues in the insurance sector.
Insurance companies should ensure that the insurtech partners offer these two models - API and AI is vital for scale and ensuring the policyholders feel the CARE.
Insurance should be mindful of customer expectations and leverage several technologies to improve CARE.
Curacel offers insurance companies both capabilities - AI and API through our claims automation and fraud detection products.
For an insurance company that is looking to lead in the industry, the road forward is apparent. Leverage analytics for personalization and laser focus on reach and engagement.
As an insurance company, you should not do it alone. You should thoughtfully identify supportive and right partners to help you set the stage for a successful digital journey.
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