Abstract:

In just a few short years, the application of tech to the traditional insurance market has caused industry-wide change. A great number of exciting businesses now offer alternatives to traditional providers. The threat to their dominance is real, highlighted by the fact that three in four insurers believe their business is at risk of disruption from insurtech. 86% know they must innovate to remain competitive. Staying the same is not an option. Traditional providers, who offered all types of insurance, are being challenged by providers who cater for niche needs. Typical insurtech users are digitally-savvy consumers, so insurtech businesses are focusing on the retail segment, with 75% servicing this sector. As McKinsey says, “for plugged-in cohorts, the use of 24/7 digital channels to receive an insurance quote or submit a claim is infinitely preferable to a branch visit”. And these needs are being met by insurtech businesses delivering highly personalised, engaging, digital solutions. Excitingly, insurtech is embracing innovative new technologies, too. In time, AI and blockchain will offer peerless security and trust, making them even more compelling for a generation of users who have grown up using tech for everything from banking to transportation to dating. Considering the importance of insurtech for insurance companies, this paper is aimed to highlight the main directions insurtech actions in the present and the main directions likely be followed the near future.