Global Head of Innovation and Product Development at reinsurance broker Guy Carpenter, Claude Yoder, has noted the many challenges and opportunities insurers and reinsurers are facing as a result of the rise of InsurTech.
As technology continues to influence the global insurance and reinsurance market, Yoder has called on companies to evaluate the demands around how their business should automate, as well as understand how they need to reshape both infrastructures and processes.
“InsurTech represents the fundamental forces of data, analytics and technology (DAT) advancements pointed at improving the insurance landscape – the qualities of InsurTech will be with us well into the future. InsurTech also represents the increasingly compelling startup community that grows by 150–200 companies per year. These new firms are striving to change the ways in which insurance is transacted,” said Yoder.
He notes the rise of start-up companies that are increasingly looking to partner with the risk transfer industry, and states that InsurTech does bring compelling offerings across the insurance value chain, which, continues to be costly and inefficient.
“Many of the startup entities started where there was more data; largely on the life and health side of the industry. Over time, as data sources grew and analytics approaches matured, startups now play across all lines of business.
“Many of the underlying capabilities of InsurTech firms such as machine learning, voice recognition and natural language processing are insurance product-agnostic – new capabilities that leverage DAT do not necessarily identify themselves as uniquely insurance-related, let alone as product-specific. The new landscape created through startups and their innovative use of DAT consider the nature of transactions generally and how to improve them,” said Yoder.
He continued to state that one of the most intersting dynamics driving change in the sector is the new iGeneration, which ultimately want to access insurance solutions in new ways, driving a need for innovation to develop new approaches and technology to meet the demands of this generation.
“In addition to the new iGeneration creating interesting dynamics for the industry, other data and analytics forces are setting the stage for opportunities. In terms of new data sources, sensors and the Internet of Things are generating data about the nature of exposures.
“With telematics, wearables and property sensors for example, a variety of product lines (auto, workers compensation and property) are capable of receiving data to help underwriting and loss control. For example, auto-based telematics sensors have been around for many years but are being reimagined as not only on-board devices attached to the car, but also as phones used as a means for transmitting driver behavior and health data,” said Yoder.