Sensors monitoring your everyday physical and digital life, artificial intelligence tailoring your insurance to fit your needs? Sound like the future? Sure—if the future is 2018. Nordic Director of Insurance in Accenture, Jacob Tovborg-Jensen, explains what’s in store—near-term—when it comes to innovation.
Developments in insurance are moving at break-neck speed: 2017 is almost over. A year that produced an array of technological advances. Like virtual assistants with artificial intelligence. Or machine learning that boosted the automation of key work processes. All new concepts at the dawn of the calendar year. At its end, most are integral to the day-to-day operations of insurance players.
Connecting with the future
So what’s in store for 2018? First off: sensors.
Across every aspect of life—in private homes, companies, in factories, on farms— sensors will help insurers get even more insight into damage prevention, pricing and, not least, the development of new products. New infrastructure, like the Internet of Things (IoT) network Sigfox that covers Denmark and a large part of Sweden and Finland, will accelerate this development. And reduce the complexity and cost of “smart” solutions for both insurance companies and their customers.
Does this selfie make me look fat?
Other big trends in 2018 will be machine learning and image recognition. These developments will enable companies to “crowdsource” auto inspection in connection with injuries or use selfies to determine the insured’s age, sex, habits (like smoking) and even their body mass. All of which influence the parameters of health or life and pension insurance. Again, if this sounds like science fiction, both are already being piloted by Europe’s leading insurers.
Busting cyber criminals
In 2017, Maersk lost $250 million when hackers tapped into the shipping company’s IT and interrupted business operations. Needless to say, cybercrime is a growing issue. As products and services that can be hacked proliferate, the market for solutions that protect against cybercrime will only grow.
Insurance “baked in”
In a move that promises to ripple throughout the industry, Tesla has developed an insurance product specifically for its vehicles called InsureMyTesla. The approach is aimed at simplifying buying and claiming insurance, and includes vehicle maintenance. The move is designed to lower insurance costs for both drivers and Tesla.
New players in financial services, like Lemonade, are upending traditional insurance models. By opening its APIs, Lemonade offers third-party providers access to a range of services including commercial websites, property applications, IT capabilities and smart-home products enabled by the IoT. Transactions occur through Lemonade’s website or app, making for a seamless, more convenient experience for the end user.
The danger of “fast followers”
Things are moving fast in insurance in Scandinavia and around the world. But this region needs to step up and stop the “fast follower” act, because it’s no longer the safe strategy. Winning companies will be early innovators. Players in this region are poised to excel because Scandinavia leads the world in digital infrastructure.
The opportunities are here and now. As are the threats from global players like Amazon and Apple. The question becomes: When we look back on 2018, will your company be ahead of the curve when it comes to adopting innovative technology? Or behind the eight ball?
This blog was initially published in Finanswatch.