Insurance Market Trends: Five Predictions for 2018

It’s almost December, so let’s start with some predictions for the insurance sector in 2018. Here are some thoughts from Tony Tarquini, European Insurance Director at Pegasystems, with his personal top five insurance tech trends expected for 2018.

EXPERIENCE BECOMES THE PRODUCT

2018 will be the year that insurance begins the transition from the terms/conditions/coverage of an insurance product being what is getting sold, into the customer experience or service becoming the product customers spend their money on.

ASCENSION OF AI

Insurers will start to catch up with other markets who are already streaks ahead in the implementation of AI. Specifically, this will likely use real-time, predictive AI for customer retention to curb the burgeoning power of the comparison sites churning policies each year. In particular, this will have a massive effect on the motor market.

BLOCKCHAIN ARRIVES

The first commercially viable blockchain will appear alongside smart insurance contracts. Blockchain has received a huge amount of hype in insurance technology. But finding real applications for the technology has been a solution looking for a problem. Now, real blockchain use cases are starting to emerge. The industry will start to think differently about what is being underwritten and how.

ROBOTICS FOR PRODUCTIVITY

Robotics will fuel a significant increase in productivity. The smart insurers will redirect the savings into strategic projects (perhaps legacy renewal) while the insurers with short futures will take the savings to the P&L. The marketplace for robotics will develop and alongside it the vocabulary for describing and understanding the different categories of robotics will emerge.

TECH GIANTS MAKE A MOVE

One of the big tech companies will create an insurer from scratch. My bet is on an e-retailer such as Amazon or eBay to insure dispatches and returns, which will eventually escalate to other insurance products. This happened in China with ZhongAn, now worth $30bn just 48 months after startup.

Do you have a prediction for the New Year? Post a comment below.

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