We are looking ahead to 2024 at IE magazine, so too is James Burton, MD for the U.K. and Ireland, LexisNexis Risk Solutions, Insurance.
Here, James identifies some key trends, challenges and solutions for next year.
There’s little doubt that as we head into 2024, the economic outlook remains challengingi. But as the pandemic showed, innovation comes out of difficult times. We are already seeing a rising hunger from insurance providers to understand more about their customers and their vehicles, homes and commercial properties. Innovative data enrichment solutions at the point of quote to claim will help them to evaluate risk, reduce claims, optimise pricing, and ultimately help ensure cash-strapped policyholders can continue to afford and buy the right cover.
Taking centre-stage in insurance providers’ to-do list has got to be a continued focus on cutting claims costs. Kicking off 2024, insurance providers will gain the ability to share and access cross-market claims data for the first time, offering a granular view of home and motor claims history for an individual and the asset at the point of quote, mid-term adjustment, renewal and claim. This will help speed the journey for the customer by filling in the blanks about their claims history while providing more context for a past claim for a fairer risk assessment. It will also put insurance providers in a more informed position to discuss how risk could be mitigated in the future. Plus of course, past claims data can play a big part in assessing and determining claims strategy at First Notification of Loss (FNOL) and the onward handling of that claim.
In motor, more and more insurance providers will turn to accurate, real-time information on a vehicle’s status, value and history, including how well it’s been maintained or how changes in vehicle valuations across the car parc affect a book of business. As well as telling insurance providers more about the risk of the owner/driver based on the car’s maintenance records, data enrichment for ‘the metal’ can also confirm accurate valuations in a way that is transparent for the customer to help support a smoother claims experience.
In the same vein, the appetite for data on advanced driver assistance systems (ADAS) will grow, as a first step in preparing for a future in which self-driving vehicles will need to be insured. Our ADAS solution – LexisNexis® Vehicle Build – has not just been designed to confirm ADAS fitment, it has been developed with a keen eye on the future to ultimately expose data and insight into more advanced and complex vehicles – leading to connected car and automated vehicles.
No prediction of the future can be complete without including the world’s greatest risk, climate change. The threat of climate change-induced extreme weather on policyholders’ homes and possessions and the consequential rise in claims, is likely to drive more insurance providers to use real-time granular data sources to help comprehend perils risks. Indeed, as the UK Environment Agency cuts flood protection for English homes by 40%ii, with 500 of 2000 flood protection projects abandoned, it seems that policy change, not just climate change will drive insurance providers to expand their geospatial data suite as we move into 2024.
Finally, with home and motor premiums surging, the affordability of insurance will come further into the limelight. The way people pay for their insurance and insight on premium affordability is going to play a key part in helping to ensure people can access the insurance they need and pay for it in a way they can afford.
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