November 5, 2018
Emerging Technology in Personal Lines
Five technologies have emerged as “power players” for personal lines insurers, based on insurer activity and the potential for transformation.
Personal lines insurers are investigating emerging technologies and developing strategies and plans related to individual new technologies. Technology is advancing so rapidly that it is even difficult to define what should be considered an emerging technology. For the past several years, SMA has been tracking 13 technologies that many consider to be emerging. These include technologies such as autonomous vehicles, AI, wearables and the Internet of Things. In our recent research, five of these technologies have emerged as “power players” for personal lines insurers, based on the level of insurer activity and the potential for transformation. The specific plans by insurers for these and other technologies are detailed in the SMA report, Emerging Tech in Personal Lines: Broad Implications, Significant Activity.
See also: 2018’s Top Projects in Personal Lines
Some big themes for emerging tech in personal lines stand out:
- Artificial Intelligence dominates. AI is often a misunderstood and misused term. However, when specific technologies that are part of the AI family are evaluated, much activity is underway – by insurers, insurtech startups and mature tech vendors. Chatbots, robotic process automation (RPA), machine learning, natural language processing (NLP) and others are the subjects of many strategies, pilots and implementations.
- The Autonomous Vehicle frenzy is cooling.There is still an acute awareness of the potential of autonomous vehicles to dramatically alter the private passenger auto insurance market. But there is also the realization that, despite the hype, the transition is likely to be a long one, and the big implications for insurers are probably 10 or more years out.
- The IoT is going mainstream. Discussions continue about the transformational potential of the IoT for all lines of business. But rather than just talking about the possibilities, there is now a great deal of partnering, piloting and live implementation underway. We are still in the early stages of incorporating the IoT into strategies and insurance products and services, but their use is becoming more widespread every day.
- UI Options are dramatically expanding. The many new ways to interact with prospects, policyholders, agents, claimants and others should now be considered in omni-channel plans. Messaging platforms, voice, chatbots and more are becoming preferred ways to communicate for certain customer segments.
See also: Insurtech and Personal Lines
Certainly, other trends and much emerging tech activity are happening outside these main themes. Wearables, new payment technologies, drones, blockchain and other technologies are being incorporated into strategies, pilots and investment plans. The next few years promise to be quite exciting as advancing technologies spark more innovation in the industry.