The insurance sector was no exception to the past several years of overwhelming digital transformation that pushed so many industries quickly forward. However, with consolidation happening in our industry, many are wondering about the future of insurance technology. How can companies continue their growth trajectory and remain profitable?
From my perspective as president of one of the fastest-growing companies in insurtech, here are three things insurtech leaders should focus on in the next year to keep profitability consistent:
Put technology on the front lines
Our industry has fully begun to accept and integrate new technology that can bring more data and greater awareness to loss events. Insurance leaders can’t be afraid of harnessing this technology. AI tools specifically developed for front-line awareness are one way technology can effectively reduce loss events.
For example, in commercial trucking insurance, technology can monitor drivers’ safe-driving habits and overall performance. Data from in-vehicle sensors can identify which drivers are performing well and which need additional coaching, to determine more accurate risk pricing.
AI will never replace the role of human decision-making in the insurance field; it enhances our capabilities to create better outcomes.
Focus on prevention first
So much of the insurance industry is focused on indemnification, but the future of the industry will be in looking beyond the claims. Future leaders will master the skill of harnessing data-driven insights to focus on prevention first, instead of indemnification.
Imagine how much money and time could be redirected if insurance companies helped their clients think ahead and head off negative outcomes. In my practice in the trucking sector, we know that our drivers are coachable and that loss events decrease over time. The AI tools we use recognize drive patterns, identifying frequencies in potential risks like speeding, hard braking and hard turning. With drivers’ safety as a core part of our mission and offerings, we can direct coaching sessions on modifying these behaviors, thus preventing accidents.
There will always be surprises and unpredictable events; accidents happen that even advanced technology can’t foresee or prevent. But in the cases where we can intervene – on the roads, in homes and offices and on job sites – companies should bring fresh attention to preventing those loss events from happening.
See also: What Big Tech Can Do for Insurance
Remember people are at the heart of insurance
Even with new technology, in this industry teamwork is one of the most powerful tools of all. As has been proven time and time again, teams that can collaborate and communicate effectively will remain profitable. Especially now, as more teams reenter the field or traditionally in-office roles become partially or fully remote, elevating team culture should be a key mission for leaders.
Ensure diversity of talent remains a consistent goal for your organization – a range of perspectives and backgrounds will help your team take a well-rounded approach to meeting business objectives and problem-solving around potential blocks.
Remember that leadership is not a closed loop – feedback is important to keeping teams, especially in insurance and insurtech, nimble and engaged. Stay honest, communicate with candor and act with integrity. You’ll find that decision-making will happen more effectively and that pivots can happen quicker when the need arises.
It’s unclear whether continued industry consolidation or another spike of growth will lead the market over the next few years. Whatever happens, insurance companies at any stage should not be afraid to maintain people-focused leadership, embrace technology and unite these capabilities to account and solve for risk – a very human problem. Ultimately for us, it’s about safer roads, safer people and being a good partner to those who need our expertise.