Top Trends For On Demand Insurance

COVID-19, (I know you’re probably just as sick of it as I am) but COVID-19 has inevitably changed many aspects of our lives forever.

As we slowly begin to return to what we remember as normal, I have begun to ask myself what is the new normal these days? For many parts of the insurance industry, normal may never return. The continuous progression of technology mixed with the cultural change of living through the pandemic has reshaped the industry as we know it. I’ve gone from being in 15 countries in 3 months to 8-10 hours of Zoom calls a day!

In April 2020, 46.6% of the UK was working from home. 86% did so due to the coronavirus pandemic. Subsequently, this dramatic lifestyle change has had a knock-on effect on many other parts of life. In this article, we will be looking into how this sudden change in human behavior has reshaped customers’ needs and demands and how new technology and the data that it collects can help insurers stay ahead of the curve.

Enter, On-Demand Insurance.

With the working from a home culture now very much the new normal the power balance in the insurance industry has undoubtedly started to shift towards the customer. Just like most industries, the pandemic has effectively turned insurance on its head.

Needs and wants have evolved. We have spent well over a year using our vehicles much less frequently. Leading customers to ask the question, do I really need to be paying this excessive annual premium for my car to just sit on the drive?

It’s no secret that many insurance companies are now facing new pressures to provide added value for the customer. The emergence of pay per mile/on-demand insurance seems like the most logical pathway for insurers to take, in order to evolve and adapt to this shift.

Just as smart meters were intended to help consumers better understand their electricity usage and as a result change their habits and reduce energy consumption – could on-demand motor insurance help us reduce the amount of traffic on our roads?

The pace of technological advancement is picking up more and more momentum. Newer cars both fuel and electric are now fitted with technology that can pull hundreds/thousands of units of data on your driving per week.

From the minute that you leave the shop floor with your car, you are essentially creating your very own portfolio of driving data. This can then be fed to insurers and other service providers for them to be able to calculate tightly bespoke and personalised premiums.

There are also other factors we must take into consideration when trying to stay ahead of the industry. As the technology behind vehicles becomes more advanced this will lead to new and safer driving behaviour causing less danger on the roads and ultimately decreasing the chance of claims.

So, with that all that in mind, and remembering that many leading car manufacturers have pledged to be fully electric over the next five to ten years. You can only imagine the masses of data that will be generated by our vehicles.

However, the question that has still yet to be answered completely is, although the on-demand insurance business model is most definitely sustainable for cars. Will it be sustainable for other aspects of life? Such as homes or valuable possessions?

It is fairly obvious that hybrid working is here to stay and with that in mind, insurers must determine the criteria of data that needs to be collected for someone before offering them an on-demand insurance premium.

A perfect example of this would be for a company offering health insurance. Before offering a customer health insurance they would use data from your phone, your fit bit, and any other resources of data that they could find that would help to give them a clearer understanding of your health and your lifestyle – more importantly how would employees feel about their employer knowing these details? about the amount of time they spend in front of their laptop compared to being on walks or exercising, dropping kids to school, taking the dog for a walk etc.

Of course, the more data you collate the more resources you need to analyse it. Most large organisations are not geared up to deal with these scenarios and this is where newer automation platforms can quickly justify their worth.

This is where psKINETIC can help. With the help of our specialists using our “intelligent glue” proposition, we can help you implement quickly ingest this vast array of data and derive value from it.

In summary:

Provide ongoing and proactive value to the customer

Most insurers are now exploring ways to evolve their business models so that they have more frequent touchpoints with their customers and provide value during the policy lifecycle rather than just at the point of a claim. Prevention or ongoing risk management services where they use IoT devices for instance to identify potential claims scenarios and address them before a claim’s situation arises. These models are designed to create loyalty through demonstratable ongoing value to increase retention rates.

Evolving and adapting with the changing tech

Established technology is evolving at an incredible pace and new disruptive technologies along with new InsurTech propositions are being launched almost weekly. Insurers need to ensure that any system decisions they make do not block them out from being able to take advantage of these new ‘things’ – our ‘intelligent glue’ proposition is designed to bring together disparate technology solutions and components easily so that they can share data.

Data

Once you have solved the challenge of being able to ingest and share data between solutions and business functions you need to look at how you apply data analytics to support and improve the quality of your decision making as well as improving the customer experience across the organisation.

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6 Tips To Mastering Data For Digital Success

Are legacy systems holding you back – unable to connect and process new data sources?

Obstructing you from identifying, quantify, place, and manage risk?

In short, too much data to handle… does this sound familiar?

Want a solution?