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5 InsurTech Trends to Watch

Bill Diaz, CEO of Ventiv Technology, distinguishes the InsurTech trends you need to know.
By: | March 6, 2017 • 5 min read

“[INSERT LATEST TECHNOLOGY HERE] is going to revolutionize insurance and risk management!”

Without a doubt, if you’ve been part of the insurance industry for a while, you certainly have heard this claim many times before.

But despite the relentless hype, some new technologies have had a profound and lasting impact on the industry. And while there is no shortage of technology options, what’s needed is the ability to distinguish meaningful InsurTech trends from less important fads.

Bill Diaz is an accomplished technologist and insurance industry veteran with the experience and industry knowledge to help identify and develop these trends.

With more than 20 years of experience in data analytics and claims administration, Diaz has led the global insurance technology businesses at Marsh ClearSight, FIS and Oracle with solutions spanning property/casualty, life/annuity, and health.

Now, he’s recently become CEO of Ventiv Technology, which provides innovative software solutions to P&C carriers, TPA’s, brokers and risk managers.

“For too long, innovation within the insurance industry has lagged. Finally, we are seeing rapid change enabled by technology. The question is who will be able to adapt and thrive under these new conditions,” he said.

According to Bill, the 5 most important InsurTech trends are:

  1. Digitization

Bill Diaz, CEO

“Digitization is an incredibly hot topic in the industry today,” Diaz said.

For the most part, digitization has helped to remodel distribution processes but can “carry across any part of the insurance value chain, from buying through to servicing,” he said. True innovators in digitization are more focused on creating on-demand products offered through mobile applications, so they can get the right product or service in front of customers at the right time.

Take travel insurance as an example. Based on location services from their mobile phone, a carrier can offer travel insurance when a potential client enters the airport.

“Carriers with a location-aware app can provide a transactional buying experience that is much easier and faster for the end customer. Insurance buying is becoming more transactional and innovative carriers or agents can take advantage of those opportunities,” Diaz said.

Of course, improved customer experience is not the only driver of digitization. Amid a continuing soft market, insurers are constantly looking for ways to cut down on administrative costs and increase efficiency. Digitization offers a way to do just that.

“Many processes within insurance are still paper-based, so it’s a very ripe area for digitization to be an effective tool,” he said.

  1. Disruption of Traditional Channels

Technology also enables new, non-traditional players to get into the insurance game, blurring the lines around traditional roles and processes.

Alternative pools of capital in the form of private equity investments or peer-to-peer insurance, for example, put pressure on carriers to differentiate themselves in the market and refine their value proposition.

Technology also changes how service providers connect with customers, allowing them more direct access to end users and more leverage with carriers. Technology companies can now more easily expand into areas served by traditional service companies.

“Don’t be surprised if you see providers move into what’s historically been considered service or distribution areas. Technology is forging these new channels between insurers, service providers and customers,” Diaz said.

“Carriers have to be able to define their value, and that value has to go beyond geographic borders or compliance, because technology is breaking down barriers and making it easier for smaller, non-traditional players to compete,” he said.

  1. Fight for the End Customer

As technology enables more direct interaction between the marketplace and end consumers, competition for customer attention is getting fierce.

“Whether you’re an insurance carrier or a broker, everyone is fighting for access to the end consumer,” Diaz said.

The primary strategy to gain that consumer’s attention is to create a unique buying experience with proprietary tools, technologies and underlying services. This appeals especially to millennials, who increasingly are the end insurance buyers, even in the B2B world.

Brand loyalty doesn’t matter so much to millennials as much as partnering with a company that’s doing something new and transformative. They’re the perfect fit for the unique services, ease of use and quick communication that insurers are striving to offer.

“It’s a challenge for carriers and brokers. Everybody is trying to make a name for themselves and create some level of distinction. Just saying that you’ve been in business for 150 years is not enough for the new generation of consumers,” Diaz said.

  1. Focus on Loss Control

The advances in insurance technology that get the most buzz are those that aim to re-tool distribution. Emerging companies have differentiated themselves by offering policies direct to the consumer through web-based apps, making the process easy and fast.

But with traditional carriers implementing similar technologies, it’s unclear how these InsurTech startups will fare in the future. The real value of insurance technology, Diaz argued, lies in loss control.

“Our core value as an industry is to help customers identify what’s happening in their risk management programs around risk control, avoidance and mitigation,” he said.

More and more, investors are realizing the benefit of loss prevention in order to reduce claims and lower insurance premiums in the longer term. The growing popularity of wearables, fleet telematics and corporate wellness programs demonstrate this shift in thinking.

  1. Analytics

“The transformation in analytics is progressing at an incredible pace,” Diaz said.

Previously, companies took a very broad approach to data, where an analyst could take all of a company’s structured data and sort through it to identify trends and drivers. But this isn’t so much “analytics” as it is standard business intelligence and reporting.

True analytics involve pulling information from multiple sources, both internal and external to the company, to develop unique insights.

“There’s been an explosion of data, whether it’s email or social media or data that exists on corporate servers. It’s so exponential that people struggle to make sense of it and see the value,” Diaz said.

The sheer amount of data has necessitated a shift from a generalist approach to a specialized approach. Data analysts now must focus on a specific domain where they have expertise.

Ventiv Technology is at the forefront of these trends, with solutions for everything from claims administration and safety management to analytics and data transformation. To learn more, visit http://www.ventivtech.com/.

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This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Ventiv Technology. The editorial staff of Risk & Insurance had no role in its preparation.




Our people, software, and innovative solutions empower organizations to achieve optimal results of their risk, insurance, and safety programs. Through the depth and breadth of our software solutions, global capabilities, and domain expertise, we are the proven leader in supporting virtually every type of industry and the largest and most complex companies in the world. Ventiv Technology proudly partners with over 550 organizations and 300,000 users in more than 40 countries.

Robotics Risk

Rise of the Cobots

Collaborative robots, known as cobots, are rapidly expanding in the workforce due to their versatility. But they bring with them liability concerns.
By: | May 2, 2017 • 5 min read

When the Stanford Shopping Center in Palo Alto hired mobile collaborative robots to bolster security patrols, the goal was to improve costs and safety.

Once the autonomous robotic guards took up their beats — bedecked with alarms, motion sensors, live video streaming and forensics capabilities — no one imagined what would happen next.

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For some reason,  a cobots’ sensors didn’t pick up the movement of a toddler on the sidewalk who was trying to play with the 5-foot-tall, egg-shaped figure.

The 300-pound robot was programmed to stop for shoppers, but it knocked down the child and then ran over his feet while his parents helplessly watched.

Engaged to help, this cobot instead did harm, yet the use of cobots is growing rapidly.

Cobots are the fastest growing segment of the robotics industry, which is projected to hit $135.4 billion in 2019, according to tech research firm IDC.

“Robots are embedding themselves more and more into our lives every day,” said Morgan Kyte, a senior vice president at Marsh.

“Collaborative robots have taken the robotics industry by storm over the past several years,” said Bob Doyle, director of communications at the Robotic Industries Association (RIA).

When traditional robots joined the U.S. workforce in the 1960s, they were often assigned one specific task and put to work safely away from humans in a fenced area.

Today, they are rapidly being deployed in the automotive, plastics, electronics assembly, machine tooling and health care industries due to their ability to function in tandem with human co-workers.

More than 24,000 robots valued at $1.3 billion were ordered from North American companies last year, according to the RIA.

Cobots Rapidly Gain Popularity

Cobots are cheaper, more versatile and lighter, and often have a faster return on investment compared to traditional robots. Some cobots even employ artificial intelligence (AI) so they can adapt to their environment, learn new tasks and improve on their skills.

Bob Doyle, director of communications, Robotic Industry Association

Their software is simple to program, so companies don’t need a computer programmer, called a robotic integrator, to come on site to tweak duties. Most employees can learn how to program them.

While the introduction of cobots into the workplace can bring great productivity gains, it also introduces risk mitigation challenges.

“Where does the problem lie when accidents happen and which insurance covers it?” asked attorney Garry Mathiason, co-chair of the robotics, AI and automation industry group at the law firm Littler Mendelson PC in San Francisco.

“Cobots are still machines and things can go awry in many ways,” Marsh’s Kyte said.

“The robot can fail. A subcomponent can fail. It can draw the wrong conclusions.”

If something goes amiss, exposure may fall to many different parties:  the manufacturer of the cobot, the software developer and/or the purchaser of the cobot, to name a few.

Is it a product defect? Was it an issue in the base code or in the design? Was something done in the cobot’s training? Was it user error?

“Cobots are still machines and things can go awry in many ways.” — Morgan Kyte, senior vice president, Marsh

Is it a workers’ compensation case or a liability issue?

“If you get injured in the workplace, there’s no debate as to liability,” Mathiason said.

But if the employee attributes the injury to a poorly designed or programmed machine and sues the manufacturer of the equipment, that’s not limited by workers’ comp, he added.

Garry Mathiason, co-chair, robotics, AI and automation industry group, Littler Mendelson PC

In the case of a worker killed by a cobot in Grand Rapids, Mich., in 2015, the worker’s spouse filed suit against five of the companies responsible for manufacturing the machine.

“It’s going to be unique each time,” Kyte said.

“The issue that keeps me awake at night is that people are so impressed with what a cobot can do, and so they ask it to do a task that it wasn’t meant to perform,” Mathiason said.

Privacy is another consideration.

If the cobot records what is happening around it, takes pictures of its environment and the people in it, an employee or customer might claim a privacy violation.

A public sign disclosing the cobot’s ability to record video or take pictures may be a simple solution. And yet, it is often overlooked, Mathiason said.

Growing Pains in the Industry

There are going to be growing pains as the industry blossoms in advance of any legal and regulatory systems, Mathiason said.

He suggests companies take several mitigation steps before introducing cobots to the workplace.

First, conduct a safety audit that specifically covers robotics. Make sure to properly investigate the use of the technology and consider all options. Run a pilot program to test it out.

Most importantly, he said, assign someone in the organization to get up to speed on the technology and then continuously follow it for updates and new uses.

The Robotics Industry Association has been working with the government to set up safety standards. One employee can join a cobot member association to receive the latest information on regulations.

“I think there’s a lot of confusion about this technology and people see so many things that could go wrong,” Mathiason said.

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“But if you handle it properly with the safety audit, the robotics audit, and pay attention to what the standards are, it’s going to be the opposite; there will be fewer problems.

“And you might even see in your experience rating that you are going to [get] a better price to the policy,” he added.

Without forethought, coverage may slip through the cracks. General liability, E&O, business interruption, personal injury, cyber and privacy claims can all be involved.

AIG’s Lexington Insurance introduced an insurance product in 2015 to address the gray areas cobots and robots create. The coverage brings together general and products liability, robotics errors and omissions, and risk management services, all three of which are tailored for the robotics industry. Minimum premium is $25,000.

Insurers are using lessons learned from the creation of cyber liability policies and are applying it to robotics coverage, Kyte said.

“The robotics industry has been very safe for the last 30 years,” RIA’s Doyle said. “It really does have a good track record and we want that to continue.” &

Juliann Walsh is a staff writer at Risk & Insurance. She can be reached at [email protected]