Insurance companies increasingly using #InsurTech to set rates

The latest World Insurance Report (WIR) finds a wave of new digital technology is confronting most insurance sectors. While disruptive, the InsurTech movement is forcing insurance companies to rethink their business model and customer relationships.

Basically, the InsurTech movement presents more technology-related opportunities than ever seen before, highlighting the need for traditional insurers to design a balanced strategy which ensures a return on their investments in innovation without a loss of focus.

The WIR report, published last week by consulting giant Capgemini and non-profit industry body Efma, found that nearly one-third (31.4 percent) of customers relied on InsurTech solutions, either independently or in combination with an established insurance company.

James Hough takes a photo of a relative's new car for their insurance company after the Valley fire roared through the area near Middletown, California on September 14, 2015

Josh Edelson, AFP/File

What is InsurTech?

Insurance is one of the oldest businesses in the world. Generally, insurance companies use actuarial tables to assign policy seekers to a risk category. A particular group is then lumped together to ensure that, overall, the policies are profitable for the company. In this method, some people end up paying more than they should based on the level of data used to group people.

This is where InsurTech comes into the picture. An offshoot of the financial technology (fintech) sector, it"s a rapidly evolving movement aimed at simplifying and improving the efficiency of insurance, making it more personalized.

InsurTech companies are utilizing a number of emerging technologies such as Artificial Intelligence (AI) and blockchain, along with the technology behind driverless cars, drones, and voice-recognition software. They act as catalysts for this InsurTech revolution and are

via www.digitaljournal.com