Artificial intelligence, machine learning, augmented reality, mobile-first – it’s hard to go a day without being bombarded by a list of technologies and trends you need to get up to speed with.
But how many of these will actually deliver ROI for those in the insurance industry, and which are little more than just buzzwords?
New research has looked at 40 reports from leading analysts, consultants, and industry influencers to provide a meta-analysis of the trends that will really impact business – and those that are likely to provide minimal returns.
When it comes to insurance, data and investments in customer loyalty technology for the ‘no strings attached’ generation of customers will be crucial, while investments into AR and VR are much less likely to pay off in the long term, according to Virtusa.
“The Internet of Things is currently one of the ‘hot topics’ in technology circles and is already transforming the insurance industry – particularly within auto-insurance, as sensors and telemetry help to determine fault in motor accidents, or reward responsible drivers with lower premiums,” Senthil Ravindran, executive VP and global head of xLabs at Virtusa, told Insurance Business.
“However, with artificial intelligence beginning to be incorporated in IoT, it will soon become possible to glean even more contextualised data from vehicle and smart street devices. This will enable companies to do things like write up accident reports instantly, adjust premiums, and pay out claims automatically – all determined by the data collected on each individual customer,” Ravindran said.
The changing nature of customer experience will also be a key driver for insurers, as consumers grow increasingly fickle about brands and look for services that can easily integrate into their lives – all while being specifically tailored to them.
“Insurance companies, like many other sectors, must accept that customer loyalty is now purely based on the service offered. So, with rising competition and sophisticated challengers, insurers must invest in technologies that fit with the expectations of the millennial generation,” Ravindran said.
Some areas will see less payoff, however – with AR and VR at the top of the list.
“While technology such as augmented and virtual reality (AR/VR) may seem exciting and can offer unique experiences to customers, it is unlikely insurers investing in this space will see any overwhelming benefits,” Ravindran said.
According to the executive, there remains a healthy level of scepticism about the maturity of AR/VR technology and its ability to deliver material business value.
“It is important when investing in these technologies to think about how it can specifically help your industry. While VR experiences may have their place in retail, customers shopping for insurance are less likely to be wowed by a gimmick,” he said.
The Trends Almanac research was driven by the sense of information overload when it comes to the latest trends and technologies – which can put companies at risk of being bamboozled.
“When it comes to tech investment, insurers really need to think about the business outcome they wish to achieve, ensuring they are not simply dazzled by the ‘next big thing’,” Ravindran said. “It is paramount that any technology you’re investing in and taking the time to implement into your business meets the specific need you wish to address.”