Innovation Unleashed: Insurtech Leaders Paint a Bold Picture for 2024
The leaders of five insurtech firms recently shared their predictions for 2024 with Risk & Insurance. Some things are safe to bet on continuing in the new year, like the fast pace of change and macroeconomic challenges on a global scale.
But what else can we expect to see after ringing in the new year? The experts we spoke with predicted changes to the ways we view risk, enhanced partnerships, and a focus on improving the claims journey for customers and insurers alike. Here are more of their predictions.
The Changing Nature of Risk
Jacqueline Legrand, CEO and co-founder of MAPTYCS, talked about the changing nature of risk and how insurtechs and insurers can partner together using new technologies to better manage risk. She said, “Risk management will become critical for all stakeholders in the insurance market to keep the cost of risk under control for both insurers and insureds. The severity and frequency of severe weather and cyber events will only continue rising, and insurance alone cannot be the answer.”
She continued, “I see this as an excellent opportunity for insurtechs to collaborate with the insurance professionals and help the industry better leverage AI, geospatial analytics, and real-time external data. New technologies will open lanes to share all types of data between customers and insurers to rebuild trust, set the foundation of a sustainable insurance system, and meet clients (and talents) evolving expectations.”
Synergistic Partnerships Between Insurtechs
Jonathan Jackson, CEO of Previsico, also talked about partnerships and narrowed his focus to the collaboration potential between insurtechs. Leveraging the principle that the sum is greater than the parts, he predicts synergistic partnerships will define 2024, developing new opportunities and driving greater value. His prediction is:
“Insurers will start to combine different insurtech offerings to benefit from the synergies that produce a sum greater than its parts. This will be driven by insurtechs collaborating on combining their services to deliver enhanced value to the insurers. At Previsico we’re taking this approach collaborating with GWT Insight on their commercial buildings data and Overstone in the art valuations market.”
AI Evolves Toward More Human Connection
Margeaux Giles, CEO of IRYS, predicts we will see a shift in AI to a more human version of the technology, something that can create a genuine human connection. She said, “2024 will bring with it the rise of humanity as a new commodity. We will see a shift across the board as AI starts to infiltrate the insurance vertical toward genuine human connection. That will manifest in several ways.
“We’ll see it in the distribution channels as consumers continue to demand more personalized experiences in both the sales and service departments. Gone are the days of the mass-produced email campaigns, and the customer service chatbot. The companies that can provide the customer experience assisted by AI (not run by it) will win in a big way in 2024.
“We will also see this creep into the technology platforms insurance companies will be adopting in 2024. To provide exceptional customer experiences, you need to also provide elevated employee experiences. These really go hand in hand, so we will see a rise in companies placing a whole lot of investment into creating workflows, interfaces, and streamlining the day-to-day operations for insurance professionals. I think this will be compounded by the fact that 50% of our workforce is retiring in the next 4 years and attracting and retaining talent is top priority for companies now.”
Creative Innovations in Embedded Insurance Continue
Megan Bingham-Walker, CEO and co-founder of Anansi, sees the continued development of embedded insurance use cases through 2024, especially products that make use of data and analytics. She also expects to see improvements within the claims experience differentiating insurtechs.
She predicted, “I think we’re going to see more applications of embedded insurance in a business insurance context. Businesses are already gathering vast amounts of risk data and sharing in accounting tools, telematics, and other databases, I expect to see many more insurance products tapping into these sources to power their products, similar to Anansi’s embedded goods-in-transit insurance.
“In the context of the current funding environment, insurtechs are refocused on reaching sustainable profitability in a capital-efficient manner, rather than investing in growth at all costs.
“The quality of the claims experience is what will differentiate the best-in-class insurtechs from the rest. Excellence in all aspects of claims is what will lead to the highest level of customer retention, so I think we’ll see lots of insurtech doubling down on this to minimize customer churn in a tighter environment.”
Operationalizing AI Will Become a Differentiator
Andy Cohen, president of Snapsheet, predicts 2024 will bring changes to the way insurers deploy technology, including the operationalizing of AI.
Cohen said, “Carriers will look back at historical technology investments and realize they are not able to support rapid and inexpensive deployment of new technology. Carriers, MGAs, and TPAs will re-evaluate historical investment areas and begin to invest in new core platforms or new wrappers to core platforms that can operationalize Artificial Intelligence.
“Over time AI itself will become commoditized, however operationalizing AI through workflow, communications, engagement, and decisioning will be the primary differentiator, and carrier core systems today do not contemplate capabilities required to rely on multiple models simultaneously throughout a complex value chain.”
Time will tell if these predictions for 2024 from top insurtech leaders will prove true. But while the future remains uncertain, innovation and forward momentum within the insurance industry continue at a rapid pace. &