How Technology is Transforming the Insurance Industry

Insurance is known for being a traditional industry; however, it's changing rapidly. There’s a new rise in “Insurtech”. This new innovative technology is reshaping how policies are sold, created, and managed. Insurtech is creating opportunities for businesses and consumers that will provide faster service, personalized coverage, and smarter risk management, although it does have some cons.  

Insurtech is short for insurance technology. It uses AI, big data, and blockchain technology to make insurance processes more consumer-friendly and fast-paced. While Insurtech offers easy convenience to the insurance world, it doesn’t come without some challenges that consumers should be aware of: 

Insurtech is used based on collecting and analyzing personal data such as business operations, health information, and driving habits. This is concerning because of how secure this data information will really be and whether it will be misused or not.  

The biggest concern with any information in the digital world is that it becomes a target for hackers. A data breach would expose customers' and businesses' sensitive information and create major trust issues.  

Insurance is a highly regulated industry; however, technology moves quicker than regulation. Insurtech companies might face compliance issues; in some cases, laws haven't caught up with these new business models. Having this uncertainty is not reliable.  

It’s no surprise technology has completely taken over, but every digital platform experiences glitches, system errors, outages, and this could lead to customers not being able to file claims or get access to their polices. A lack of backup options does make Insurtech risky.

While Insurtech is fast-paced and does come with its pros, this doesn’t mean that it’s a perfect solution for everyone. It’s important to do your own research on Insurtech and see if it’s something that you would be able to trust with sensitive information. For more insurance information, check out our page.