Tag Archives: technology

How Tech Makes Sector Safer, Smarter

The digital transformation of the insurance industry is first and foremost motivated by the demands of clients, who are always looking for the easiest way to solve claims. New technologies also can improve processes, eliminate fraud risks and collect data that can be used to personalize services.

Together with banking and finance, insurance is one of the most highly regulated industries, and any change must go through lengthy and rigorous probation. This explains the lag in using state-of-the-art technology compared with other industries.

However, things are changing, and the insurance industry can see gains of $1.1 trillion just from AI.

Here are five ways technology can make the insurance industry better for clients and more efficient for providers.

Process Automation and AI-Based Decisions

Digitization has affected most business sectors by cutting processing times, simplifying procedures and offering more power to clients. The insurance industry can benefit from all this, too.

Claim processing can be stepped up, with clients performing some part of the registration process, then letting AI do the rest. Technology can also increase renewal rates and cut down churn by sending automatic reminders or scheduling automated payments.

Underwriting is no longer delegated exclusively to people. Now it is a mix of automatically computed risks and human decision-making.

Since this industry relies heavily on extensive paperwork, any help regarding recording, sorting and retrieving information is a notable improvement. OCR and computer vision make insurance brokers’ works easier and save time.

Self-Service Portals and Chatbots

Clients are becoming more tech-savvy with their ever-more=powerful mobile devices. They are no longer ready to wait in lines at an office to be served by an insurance officer. The trend is to create a website or an app where clients can buy a policy, submit claims and evidence, create support tickets and request payments as quickly and conveniently as possible.

This should be part of an integrated omnichannel strategy, where the client has a choice of communication channels with the insurance provider.

See also: In Age of Disruption, What Is Insurance?

While some clients still prefer talking to a human agent, and this service is not going anywhere any time soon, chatbots are gaining ground. These solutions are helping insurance companies reply on the spot, thus eliminating waiting times, which are frustrating for customers.

IoT-Based Prevention

Better prevention methods could help avoid a great deal of the hazards for which insurance companies have to pay. Pipe leaks, fire outbreaks, gas leaks and more can become things of the past with the help of smart IoT sensors, which are becoming the norm in modern homes.

This is something AXA is already testing within smart homes. When home appliances are connected to a central system and give constant feedback, it becomes easier to avoid accidents by simply shutting off those posing a high risk. In a disaster, it will also be easier to process the claim because there is a clear record of the underlying cause.

Fewer Accidents With Self-Driving Cars

Self-driving cars will eventually be able to avoid collision with each other and other objects, reducing the number of accidents and saving insurance companies millions of dollars.

Until then, installing smart safety systems in vehicles can also diminish the number of accidents or at least minimize adverse outcomes.

Healthier With Wearables

Most chronic health problems are preventable if people adopt a healthy lifestyle. Some insurance companies are already implementing gamification schemes to motivate their clients, with the prize being a discount in the insurance premium paid. The motivation of the insurer here is that the cost of the bonuses or discounts is far less than the doctors’ fees.

Technology can also help medical providers keep track of the entire care delivery cycle, from the admission to long-term remote monitoring. This can smooth out the friction between hospitals and medical insurance providers, as this insurance portal development project explains in detail.

Ethical Issues of IT in Insurance

Although the consumer’s benefits in the form of personalization and less friction are apparent, there is also a darker side of using IT in insurance. Ethical issues include:

  • Data governance. Because these systems are very recent, there are few legislation points covering data accessibility and management, except for GDPR and some others.
  • Security and privacy. As with any other information systems, the problems of authentication and encryption remain relevant.
  • Transparency. Most smart systems act as black boxes; therefore, clients and staff have no way to explain why the system returns a particular answer. This contradicts the fundamental right of the client to be fully informed about the service.
  • Bias and discrimination. The primary concerns here are related to the ability of AI to qualify a specific client as high-risk and deny the client the service or put the client at a disadvantage.
  • Job losses. Reports show that as many as 18% of current insurance jobs could be automated by 2025.

See also: IT Security: A Major Threat for Insurers  

Despite the risks, using IT in the insurance sector means that there are fewer intermediaries between the client and the provider, faster service, less friction and overall more accessible policies. As the insurance tech is maturing, it’s time for providers to weigh the advantages versus risks and consider a digital pivot while it can still provide a competitive advantage.

Intersection of Tech and Holistic Health

There is a misconception in the healthcare field that technological innovation is opposed to the philosophy of holistic care. Tech is viewed as artificial, manufactured and impersonal — it values human experience only for the sake of developing better algorithms and treats the physical body of the patient without care for their personhood.

In contrast, holistic care is seen as organic and natural, elevating the physical, emotional and spiritual needs of an individual and seeing, not a patient, but a person with a particular and unique social and cultural background.

It is easy to see why those invested in whole person care have resisted the march of innovation or flat out rejected it.

But to see these two things in tension is to ignore the character of technology — that is, as a tool rather than an end in itself. Take the smartphone. It can be used to ignore interpersonal connections, while endlessly scrolling through social media feeds or web content — but it has also provided the means of keeping up and strengthening interpersonal connections, through video chat, text messaging, phone calls and countless other forms of communication.

The lesson of the smartphone generation? Tech is what you make of it.

And that lesson should be applied to tech’s role in healthcare. Tech is not a threat to holistic care, but rather a means to scale its interpersonal experiences, and we need to start viewing it in that light. Tech overcomes the real threat to holistic care — human limitation.

In an ideal world, caregivers would be available 24/7 to hand deliver personalized care to their patients. In a tech-enabled world, we can come close to realizing this vision, as digital tools provide the means to extend care into a person’s home while overcoming the physical obstacles of distance and time exacerbated by the shortage of caregivers.

See also: Can InsurTech Make Miracles in Health?  

Of course, the philosophy of holistic care is not based solely on interactions between patient and caregiver. In fact, if holistic care is successful, the need for a caregiver drops away, as the goal is to create independent individuals who can sustain and manage their own health.

Tech can foster this independence through delivering accessible educational content to patients right where they are, enabling them to take an active role in their own health and become self-reliant. From this angle, the patient is not just another diagnosis, but an individual who with the proper means can be empowered to control their own health and wellness. Tech can aid that patient to learn about and be encouraged to pursue healthy lifestyle choices that fit their individual needs, and can keep them off medications and out of the hospital: a primary goal of holistic care.

This type of individualized care plan is made possible by “big data” — the very algorithms that at first glance seem so impersonal, reducing the patient to a statistic. Far from depersonalizing care, these are at the heart of driving the shift from diagnostic to preventative care, revealing novel insights and helping to create plans that are tailored to the individual person and encourage patients to view themselves as uniquely structured individuals whose care management should reflect that, and not be delivered through a one-size-fits-all approach.

See also: Social Determinants of Workforce Health  

Imagine a world where the human connection of whole person care isn’t limited to physical touchpoints, where, instead of reaching five or 10 patients in a day, a care provider can reach hundreds. A world where hospitals are empty from preventable admissions and the drug industry unnecessary except in exceptional cases, where redundant protocols don’t exist.

This is the promise that technology has fulfilled in other industries, and it’s time that the champions of holistic healthcare set aside their skepticism to take a second look

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Juneen Belknap, Principal, Financial Services-Insurance for PwC Advisory Services, talks with ITL COO Paul Winston about how PwC is working to provide solutions and shape how people think about the integration of modern new technology, including insurtech, with legacy systems to drive change and innovation in insurance. Among the insurtech companies PwC is working with to reimagine insurance processes are Terrene Labs, Snapsheet and InvestCloud, among others.

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Goose & Gander’s Robin Roberson

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