Insurers now have unprecedented access to a wealth of information. More data means better underwriting choices. But it also means that organizations cannot keep up with the volume and diversity of data accessible to them, and the pace at which that information is delivered.
These insurance tech trends for 2023 and beyond are based on our projections for the upcoming year. These often indicate the continuation or acceleration of current insurance technology developments.
Across all businesses, facts about big data and cloud-native analytics are seen as the most prevalent in the insurance industry.
Table of Content:
1. Key Tech Challenges in the Insurance Industry
2. How Is Technology Changing the Insurance Industry?
3. Key Insurance Industry Trends
4. Get Innovative Insurance Software Development Solution with VLink!
#1 - Legacy Systems
Unless your firm is new, you will likely have software – and processes – in place to manage insurance policies. These systems are called ‘legacy’ if they are obsolete and vital to essential business processes.
It is challenging for insurance businesses to digitally convert, since old systems are costly to maintain and replace.
#2 - IT Skills Deficit
Adopting new technology demands IT knowledge that insurance companies may not have. According to a recent survey, 81% of insurance executives are concerned about talent availability.
It’s not only about a candidate’s computer abilities; an employee must be the right fit to be genuinely productive. Unfortunately, finding a candidate with the proper mix of technical, soft, and experienced capabilities may be challenging – and competitive.
Core tech trends have emerged in recent years and affect nearly every industry. Products and services are being redesigned due to numerous technological advances and shifts.
A new reality requires incumbents to change their operating models, products, and core processes. Executives must be aware of the impact of these technologies and ensure that their organizations are positioned to unlock their potential.
Therefore, business leaders must abandon long-held assumptions and business models to find innovative ways to produce and distribute new products.
Adopting new ways of doing things is one of the biggest challenges in insurance digital transformation. That has changed since the pandemic. The willingness to change does not imply that it will be simple. Insurers will face Nine challenges:
#1 - Artificial Intelligence
AI is quickly evolving, with AI-enabled products becoming ubiquitous.
Consumers want individualized experiences, especially when shopping. Insurers may use AI to provide these distinctive experiences, fulfilling customer expectations. The objective is to employ AI to generate tailored experiences based on an individual’s behavior and habits.
ML & AI development solutions can also speed up claims processing and modify the underwriting process. AI also speeds up insurers’ data access, and eliminates human error which can lead to speedier reporting.
#2 - Machine Learning
Insurance developments in 2023 will feature overlapping technologies to improve accuracy. Machine learning can not only enhance but also automate claims processing. Files can be evaluated faster and more accurately when digital and available through the cloud.
This automated examination can affect insurance administration and risk assessment, and claims. In the era of ML, you don’t want to be left behind. Machine learning is poised to become a standard tool in the insurance industry.
#3 - Internet of Things
Tradition has it that clients dislike the standard insurance claim process. It isn’t very reassuring when insurance claims take weeks or months to process. Modern consumers want insurance companies to integrate technology into their daily lives. Data-driven judgments are made possible via IoT solutions.
As a result, insurers may process claims more quickly by eliminating paperwork. It saves users time by eliminating the need to fill out endless forms. Wireless biometric and environmental sensors simplify assessing risk and adapting policy.
#4 - Chatbots
High-quality digital assistants that employ conversational AI helps chatbots insurance industry to substantially cut costs and turnaround time for insurance. However, customers are wary of using voice assistants to do transactions.
And they’ll wait in line to communicate with people. A chatbot must know when to hand over to a person to serve a consumer effectively.
#5 - Blockchain Data
Many carriers use smart contracts and blockchain technology to improve the underwriting process. Because of the new insurance tech trends, underwriting has been enhanced because insurers can examine accurate information on previous insurance policies and claims and provide more precise pricing and selections for their insurance products.
Insurers stand to gain a lot from blockchain and smart contracts, but many struggle to make the switch. Adoption, on the other hand, will continue to rise.
#6 - Drones
By the end of 2023, we expect robots and drone technologies to be more prevalent in several businesses, including insurance. According to the FAA estimate, 2.85 million drones will be in the skies this year, 450,000 being commercial.
According to the survey, insurance companies accounted for 17% of all drone applications in 2018.
Many insurers use drones and robots to increase risk management and claim efficiency. Drones collect data about structures that typically need a team of surveyors.
For example, Deloitte says better view, a property, and casualty insurance company, deployed drones for almost 6,000 roof assessments in two years.
#7 - Cloud Computing
Cloud Computing has increased corporate growth and improved customer experience for insurers. Globally, insurers are constantly pressured to innovate and adapt to market disruption.
Cloud computing solutions for the insurance sector can help insurers improve IT agility and speed up project implementation. It also allows them to test and deploy new technology swiftly. As a result, they can now supply services faster.
Also Read: Beginner’s guide: Type of Cloud Computing Services to Integrate in your business.
#8 - Telematics
Telematics will continue to influence auto policy. Think of telematics as vehicle insurance’s equivalent of wearable tech. Data from your car, such as your speed, location, accidents, and more, may now be watched and analyzed by the data analytics software for insurance companies to assist in calculating your policy premium.
Take Progressive’s snapshot, for example.
#9 - Automated Renewal
Enrollment in employee benefits might be slowed by a high volume of quotations that require underwriter evaluation. In addition, administrative chores like receipt of data or manually running an analysis take up 30-40% of an underwriter’s time.
Machine learning can automatically shorten workloads. For example, carriers may train machine-learning algorithms to help sales and underwriting managers distribute quotations more efficiently.
Automated renewal applications can reduce carrier involvement in stock quote requests by automatically queuing references for manual inspection and creating policy renewal packages.
As a reputed offshore software development company, we leverage technology innovation to your business advantage. Our professionals ensure to stay up to date with the advanced tools with insurance industry insights and trends to transform your ideas into profitable software.
At VLink, we help insurers and tech companies get new levels of efficiency with our custom insurance software solutions.
With today’s customers being more tech-savvy and omnichannel-focused, insurance businesses must innovate to stay competitive. These insurance technology trends in 2022 rely heavily on technology, and insurers might invest in low-code platforms to simplify operations and better serve policyholders.
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