Insurance Sector: Trends that Will Shape this Industry’s Future

by Tech Geekk writer

A growing number of insurance organizations had already initiated their digital transformation journeys when the pandemic came along. Suffice it to say that 2020 served to show to this sector how it was largely thanks to digital tools it was able to achieve a modicum of business continuity. To help your insurance business brace for uncertainties of the future, here are some technology related trends you would do well to keep an eye on.

Internet of Things: Data is everywhere and perhaps nothing else has served to boost access to massive amounts of data quite like the Internet of Things (IoT). IoT devices are already empowering companies with access to staggering amounts of data and the number of such devices will grow into the billions over the next few years. This growth in the amount of data is driving insurers to push for set standards, etc. in order to help them drive better value out of this abundance of data in the world.
Data security: We live in a highly connected world, thanks to all the many devices we rely on on a daily basis. In the context of the insurance industry, this has given rise to concerns about data security and means to safeguard sensitive information collected from customers. These concerns have already driven governments and regulatory bodies to introduce stringent rules to protect data. In the future these security concerns are also expected to drive growing IT investments in the insurance sector.
Evolution of customer expectations: There have been lots of changes in insurance customers’ expectations: customers now want their insurers to offer on-demand services that can successfully tend to their individual problems and concerns. This shift in customers’ expectations is driving a vital change: insurance companies now seek to sell to their customers goals instead of, you know, merely products and services.
Digital ecosystems: Some of the key changes in customer demands and expectations has led to the rise of a variety of ecosystems, i.e. collections of various services and offerings packaged into one. This has resulted in an increase in the amount of data companies are able to gather and leverage. Such a growth in the amount and kind of data insurance companies have access to has resulted in better precision of important processes in the sector, such as underwriting. It has also afforded insurers to fine tune their pricing strategies and offer programs that target prevalent concerns in the sector.

If the ongoing coronavirus pandemic was not enough demonstration of just how much the insurance sector has been affected and, thus, evolved, over the past decade, there is also plenty of research and studies to demonstrate the impact of a variety of factors have had on this sector. In addition to the health crisis posed by COVID-19, there is also the evolution of technology, change in customer demand and expectations and countless other such factors that have brought about enormous change in this sector. Such change has made one thing amply clear: digital transformation for insurance companies is an absolute must — at least for the ones to not simply survive but also thrive. If you too wish to adapt to these changes, the industry would do well to remember that digitalization is the only way forward.