A thread woven throughout sessions and sidebars at DigIn 2019 was the idea that insurance innovation is in a period akin to halftime during a football game. Over the past few years, the industry has experienced a substantial ramp up. It’s no longer a question of whether accurate property data is relevant to a carrier’s business – that’s been made abundantly clear. Instead, there’s an emphasis on reflection. What will carry insurance innovation through the second half of the game to a win? Or, in other words, how have these insights enabled carriers to increase efficiencies, lower costs and provide customers with the best possible experience?
Carriers are looking to understand how to best optimize their data and insights to take their processes to the next level. This reflection was evident in a number of panel discussions throughout the conference this year.
Customer experience is vitally important, and oftentimes, that means automation
At the core of almost every session, understandably, was a focus on customer experience. Many discussions focused on the future of virtual agents, chatbots and natural language processing at the point of claim. As the tech innovation expectation bar keeps rising in other industries, insurance carriers noted that customer experience in the property insurance space should keep pace.
In some cases, elevating the claims process may be as simple as augmenting the carrier’s existing workflow with property insights into depreciation and confirmation of work completed. As for underwriting, there’s value in automating the form-fill process by prefilling pertinent information, for instance an accurate roof age that considers repair work and roof replacements in its estimation.
Insurance innovation is inevitable, maintain your competitive advantage
A number of discussions during DigIn 2019 delved into how innovation and progress in property insurance is inevitable. What carriers have control over, however, is how they fit into the transforming dialogue. For instance, carriers that stay ahead of the curve and implement new, innovative processes that leverage property insights may fare better than those that avoid these trends, potentially resulting in adverse selection.
What’s more, forecasts suggest new entrants to insurance will increase over the next few years. These entrants will not only be new insurtech companies, but also tech companies from other industries. Nonetheless, established insurance carriers still have an edge. Barriers to entry in this industry include regulation hurdles and the breadth of existing data that insurance carriers have regarding customer preferences and best practices. As a result, carriers that embrace insurance innovation will likely have an upper hand as the industry progresses.
Shifting weather can increasingly impact your book of business
Recent shifts in weather activity have led to systemic changes within the property insurance industry.
One such cause of loss is flooding. Carriers are poised for growth in the flood insurance industry. The status quo until now is that flood insurance is only needed when it’s mandatory, as dictated by flood maps. As it stands, customers seeking flood insurance turn to the National Flood Insurance Program (NFIP). While NFIP is still necessary, there’s a gap in the market for private flood insurance.
Wildfires are another increasingly dominant cause of loss in the U.S. As a result, new systems are emerging to address this risk in California and other wildfire-prone states. The need for increased innovation across fire coverage is spurred by the rapid uptick in wildfires that are breeching increasingly populated areas. Especially as a number of carriers are retreating from the state in the past year, carriers that know how to accurately and confidently underwrite risk in California (and beyond) will take substantial market share.
Interested in incorporating BuildFax property insights into your underwriting and claims processes? Contact a BuildFax representative today.