The pandemic created structural changes that have forced incumbent insurance providers to become more competitive in the market. According to Accenture, almost 86% of incumbents believe they need to innovate at a far faster pace in order to remain a player.
This article dives into a few trends in the insurance space that are helping the big insurers to become more competitive.
Usage-based policies
Growth of usage-based policies is on the rise. Anticipate a significant increase in short-term insurance policies that are based solely on what consumers are doing precisely, rather than broad possibilities. Apps that will be able to detect what policies consumers should purchase will also become normal.
Personalization
Insurance companies continue to collect important and “big” data that help them to understand consumer behavior and overall preference. Data is collected from IoT devices, phones and other smart devices.
This enables an incredible UX/UI for consumers and offers the customers better services that are more relevant to their particular needs.
Gamification
Gamification is a newer strategy that should be more common going forward. Gamification has to do with improving the digital UX by integrating games/activities that ultimately benefit the consumer by offering them prizes, discounts, etc. Incumbents are seeing increases is loyalty program membership with gamification.
Smart contracts
These are lines of code that are held on blockchain. Smart contracts can actually execute by themselves under certain criteria. We believe the market will be upwards of $300 million by the end of 2023. The insurance incumbents and consumers benefit from these contracts because they offer security and transparency on a higher level.
