Insurance Industry

Part
01
of seven
Part
01

Insurance Industry - Trends 1

After searching extensively, our team determined that two trends around the technologies and future capabilities shaping the implementation of claims management in the US insurance Industry are AI/ML and the IoT. We resolved this as the case after analyzing various industry databases and credible media sites such as Digitalist Magazine, McKinsey, Property Casualty 360, Insurance News Net, Forbes, Internet of Business, and more which presented them as the key trends. Some US companies implementing these trends include

ARTIFICIAL INTELLIGENCE (AI) AND MACHINE LEARNING

AI and ML are predicted to impact the future implementation of claims management. Today, insurance companies are investing heavily in AI/ML related technologies, which have increased more than five-fold since 2000, according to a Stanford University study. Another study, the 2017 Global Trends report, reveals that this sector invests an "average of $124 million per company in AI—$54 million more than the average across all other industries." In the future, ML systems will have advanced to simplistic operators and will be able to assess the impact of damage to predict the cost of repair and weigh hundreds of claims against each other to determine their qualification index for instant settlement. Additionally, ML will allow insurers to streamline claims audits and put them into critical stages of the claims process, "including investigation, evaluation, and settlement" thus enabling insurance firms to prevent claim leakage and overpayments before money leaves, according to Insurance Innovation Reporter. In addition, AI will be used in the future to automatically and swiftly, by referencing with various systems in mere seconds, to detect potential frauds and trends.
Lemonade Renters Insurance, a New York-based insurance tech company, has developed an AI/ML system that assists the firm to manage claims faster and provide customers with fast pay-outs.
Another insurance firm, Elafris has partnered with several insurance companies including Nashville-based Jupitor Auto Insurance Co. to leverage an AI-driven platform that helps customers to check the status of their auto claims and make monthly payments.

THE INTERNET OF THINGS (IOT)

Tomorrow's insurance leaders must prepare for the adoption of IoT for claims management. According to The Balance, a database of industry experts' opinions, it is the "biggest trend impacting the insurance industry in the coming years." The IoT market is expected to grow at a CAGR of 65.89% between 2016 and 2022 to reach USD 42.76 billion with North American share of the industry at 45%. In the future, the large amounts of data generated by IoT will enable insurers to speed up claims management and offer tailored customer service. For example, as sensors become commonplace and widespread in the home, IoT will be frequently used to proactively monitor water and temperature levels to alert both the insured and insurer of issues before they arise. Insurance firms will also be able to monitor vehicles in real-time using integrated IoT and telematics to observe how policyholders are driving, "such as the speed they travel, the amount of sharp braking, how quickly they take corners, the time when they drive, and a whole host of other factors." With this information, they can help modify driving behavior by sending frequent advice to the insured and reward or penalize good and bad drivers respectively by lowering their premiums or charging additional costs, sequentially.
"P&C carriers are also utilizing phone apps and automotive systems that furnish crucial information for automating and quickly closing claims shortly after accidents."
State Farm uses the Drive Safe & Save telematics programme, a smartphone, and beacon that reports to the insurer exactly how the driver of the insured vehicle is driving or the driving habits in general. Disciplined drivers, those who drive safe, could save up to 50 percent on their annual policy.
Lastly, Liberty Mutual has partnered with Google’s Nest to "implement connected smoke alarms in the home, enabling customers to reduce the risk of a fire, and in turn, reduce their home insurance premiums."

Part
02
of seven
Part
02

Insurance Industry - Trends 2

Two more trends around the implementation of technologies and future capabilities in the US insurance industry are the use of telematics and drones.

RESEARCH STRATEGY

To determine two more trends around the implementation of technologies and future capabilities in the US insurance industry, we first looked at the trends identified in the first request to ensure there would be no repetition. We noted that the previous request included artificial intelligence & machine learning and the internet of things (IoT) as trends. We researched insurance industry databases and credible media sites (like Insurance Business, Forbes, CB Insights, and others) for current technological trends in the insurance industry. Through this search, we determined two trends based on how often they were mentioned in the reports/articles about technological trends in insurance.

SOME TRENDS AROUND THE IMPLEMENTATION OF NEW TECHNOLOGIES AND FUTURE CAPABILITIES IN THE US INSURANCE INDUSTRY

Provided below are two trends/new technologies that highlight the future capabilities of the US insurance industry.

TELEMATICS OR WIRELESS DATA

Telematics, or wireless communication of data back to an organization, is expected to be a massive area of growth for insurance. Cars equipped with monitoring devices measure data from various indicators such as speed, location, accidents, and more. The monitored data is collected, processed using analytics software, and used to determine the customer's policy premium. The use of telematics data also reduces the claim expenses for insurers.
When customers input a telematics device into their cars, insurers can determine in real-time where the vehicle was damaged, the extent of the damage, the probability of bodily injury, and what other car was involved (in the case of an accident). Usage-based insurance (UBI) uses the data obtained from a telematics device the most, as it helps to assess the driver's risk and determine the right place for their auto insurance. As a result of the adoption of telematics/wireless data, the time for claim resolution was reduced by 50%. Also, customer satisfaction increased, with fewer loopholes for fraudsters.

Progressive, one of the largest providers of car insurance in the US, uses telematics through their Progressive Snapshot mobile app and have collected 1.5 billion miles of driving data. The app pilots a new underwriting algorithm for mobile customers that includes variables related to distracted driving. Progressive Snapshot requests that drivers should get a quote first and then drive with the Snapshot app or plug-in device for the first policy period before they can earn discounts. The company offers its customers discounts based on their driving.
The concept of earning discounts due to proper or careful driving typically gamifies the customer's experience. Drivers earn discounts over time, which acts as an incentive to keep using the app, even though it requires that they enable location tracking. The data collected from the device is used to calculate an insurance quote or rate that the driver will pay when a policy renews. Progressive's Snapshot program is the source of over $700 million in discounts, handed out to drivers who can save on average $130 every year.
Allstate, one of the largest insurance providers in America, also uses telematics. With their Arity unit they receive almost 9 billion miles of driving data every month. According to its CEO, Thomas Wilson, telematics will be the primary driver of insurance pricing in auto insurance, and it requires the customer to do something rather than just buying data. Since the implementation of telematics, insurance companies have reported a 45% reduction in accidents and a 50% reduction in accident payout costs.

DRONES

Drones have some applications across many stages of the insurance life cycle such as collecting data to calculate risk before issuing a policy, aiding in preventative maintenance, and assessing the damage following a loss. Through the use of drones, pictures of the property to be insured can be obtained before providing cover for it. Also, the safety of claims assessors is improved and they are able to carry out their inspection faster when a drone is in play. In the case of a disaster, drones can provide the extent of the damage long before the site is safe or accessible, they reduce the turnaround time, and they enable faster resolution of the customer's claim. The insurer also has major cost savings through the level of efficiency provided by drones.

AIG, which specializes in aviation insurance, has initiated the use of drones in the insurance industry with their in-house drone program. They share the data collected from drones with following insurers on insurance programs, to help them quantify claims, and with clients to help them recover from the loss.
State Farm was granted a waiver by the Federal Aviation Administration (FAA), that allowed their drone pilots to conduct damage assessment flights following Hurricane Michael. The waiver gives State Farm the authority to fly drones beyond a visual line of sight and over groups of people in the states of Florida, Georgia, Alabama, North Carolina, South Carolina, and Virginia. The insurance company can thus utilize drone technology as a tool to assist claim representatives in the proper inspection of their customers’ homes and properties after hurricanes. According to research by Goldman Sachs, the total addressable market due to the implementation of drones for insurance claims in the US is worth $1.418 billion.


Part
03
of seven
Part
03

Insurance Industry - Trends 3

Two additional trends around the implementation of technologies and future capabilities in the US insurance industry are the use of social media data and the use of chatbots. More information on the topic has been presented below along with the research strategy.

RESEARCH STRATEGY

To determine two additional trends around the implementation of technologies and future capabilities in the US insurance industry, we first looked at the trends identified in the first and second requests to ensure there would be no repetition. We noted that the previous two requests included artificial intelligence & machine learning, the internet of things (IoT), telematics or wireless data, and drones as trends. We researched insurance industry databases and credible media sites (like Forbes Insurance Up, The Digital Insurer, and others) for current technological trends in the insurance industry. Through this search, we determined two trends based on how often they were mentioned in the reports/articles about technological trends in insurance. 

SOME TRENDS AROUND THE IMPLEMENTATION OF NEW TECHNOLOGIES AND FUTURE CAPABILITIES IN THE US INSURANCE INDUSTRY

Provided below are two trends/new technologies that highlight the future capabilities of the US insurance industry.

SOCIAL MEDIA

Insurance companies now use social media to not only market but also to monitor and assess if their customers have committed insurance fraud. Social media data aids risk assessment for P&C insurers and improves its capacity to discover fraud. Through this, the insurance companies can cut the costs used to settle frivolous and fraudulent claims estimated at $80 billion per year in the U.S., which serves the collective interest of the honest customers and insurance companies.

GEICO is an example of a US insurance company that has started to use public social media data to improve customer service, uncover fraud, and generate sales.

Liberty Mutual Insurance uses social media to analyze the claimant key information associated with a specific claim, such as online posts, photos, and other media channels.

CHATBOTS

According to Duck Creek Technologies, chatbots will power 95% of all customer interactions by 2025. Grand View Research estimates that the global chatbot market will have an annual growth rate (CAGR) of 24.3% and attain $1.25 billion by 2025. Chatbots operate through messaging apps that many customers already use. By using AI and machine learning, chatbots will interact with insurance company clients, saving a company the money it spends on its staff. To be effective, chatbots should have neutral language processing and sentiment analysis. With this, it should be able to communicate seamlessly with the customers, walking the customers through the company’s claim process and leaving the more intricate cases for human attention. 

Kate is a GEICO chatbot that communicates with the company clients and prospective clients, aiding them via voice or text in resolving coverage and policy inquiries 24/7.

Allstate Business Insurance Expert (ABIE) is the Allstate Business Insurance chatbot that assists small business owners by walking them through the initial inquiries of how insurance claims work.
Part
04
of seven
Part
04

Insurance Industry - Trends 4

Blockchain technology and cybersecurity are two additional trends around the implementation of technologies and future capabilities in the insurance industry. Blockchain is advantageous to the insurance industry for identity management and underwriting to claims processing, reliable data availability, and fraud management, while cybersecurity is expected to help insurers enable their clients to understand their claims processes better.

METHODOLOGY

To identify 2 more trends around the implementation of technologies and future capabilities in the insurance industry, which have not been covered in the earlier parts of the request, we researched industry reports from credible portals like EY, McKinsey, WNS, and others. Based on them, we selected the trends that were repeated as current trends in 2 or more reports and were previously not covered.

Next, we provided details on how each trend is changing the strategy of insurance and insure-tech companies and their impact specific to claims service delivery or claims management in the insurance industry. Unfortunately, out of the two trends relevant to this request found from our investigation, none of the reports from the directories researched provided direct information stating 2 to 3 US companies that have adopted one of them, cybersecurity, or have made plans to leverage it in their business in the public domain.

However, we found that Ohio insurance companies from March 2019 were required to follow the new "Cybersecurity Requirements for Insurers" passed with Senate Bill 273. Hence, we researched insurance companies that operate in Ohio and listed them as the companies that are adopting or have adopted the the cybersecurity trend, as the requirements of this bill mandated them to adopt cybersecurity in their insurance practice.

trends around the implementation of new technologies and capabilities in the insurance industry

1. BLOCKCHAIN

Blockchain technology helps to secure data management across multiple interfaces and stakeholders without loss of integrity. This technology is also advantageous for identity management and underwriting to claims processing, fraud management, and reliable data availability. Also, blockchain impacts the strategic developments for insurers and their customers in areas such as asset tracking and assessment, fraud prevention, and microinsurance, which is a new form of insurance. Furthermore, according to a report by the Boston Consulting Group, blockchains would help the “worldwide property and casualty (P&C) insurance industry reduce its combined operating ratio by 5 to 13% points and generate upwards of $200 billion more in technical margin from its current gross written premiums.”

IMPACT of blockchain IN THE INSURANCE INDUSTRY

WNS reported that blockchain would be highly useful for underwriting to claims processing among other benefits. Also, blockchain is expected to help expedite claims to be processed, paid out claims, or denied claims, as per a report by Disruptor Daily.

US COMPANIES THAT HAVE ADOPTED/Planning to leverage blockchain

Tierion, a company founded in 2015 and based out of Mountain View, CA turns blockchain into a worldwide platform for verifying any data, file, or process, and provide timestamp proof of the data. Similarly, New York-based AIG (American International Group Inc.) rolled out smart contract insurance policies expected to utilize blockchain to manage complex international coverage. AIG is also known to be the “first such policy to employ the blockchain digital ledger technology.”

POTENTIAL COST SAVINGS FOR COMPANIES USING Blockchain

As per reports by Disruptor Daily and WNS, blockchain helps insurance companies that adopt the blockchain technological trend to reduce administrative and operational costs, which also sets the path to them becoming insurtech companies.

2. CYBERSECURITY

With cybersecurity, insurance companies can protect their data, reduce brand and reputational risk, effective regulatory compliance, and increased customer confidence. This will, in return, help insurers strategize towards the increased usage of tablets, mobile-to-mobile payments, big data analytics, aggregators, third-party contracts and personal digital devices for their customers to manage risk, more agile. Other areas this technology is expected to influence the insurance industry include protecting assets, brand, and reputation; as well as enhancing the user experience.

IMPACT of Cybersecurity IN THE INSURANCE INDUSTRY

As per a report by Information Age, cybersecurity adoption in the insurance industry would help insurance providers to enable clients to understand their claims processes better. This trend is poised to improve the entire insurance industry as a study by PwC estimates that cyber insurance would grow from about $2.5 billion of its current value to around $7.5 billion over 10 years. Furthermore, cybersecurity in the insurance company would reduce impacts from data breaches and cyber-attacks, as well as provide coverage against losses like data destruction.

US COMPANIES THAT HAVE ADOPTED/Planning to leverage Cybersecurity

Ohio insurance companies from March 2019 need to follow the new "Cybersecurity Requirements for Insurers" passed with Senate Bill 273. Hence, insurance companies such as Aetna Better Health Inc., Allied Insurance Company of America, American Family Insurance, which are some firms operating in Ohio must comply with the cybersecurity trends to protect their data. Another US company that may has adopted this trend is Anthem that spent approximately US$100 million to avoid bogus domain name/phishing through cybersecurity.

POTENTIAL COST SAVINGS FOR COMPANIES USING Cybersecurity

As per McKinsey's report, focusing on vital assets helps insurance companies save up to 20% of cybersecurity cost. Also, cybersecurity helps in saving fines, legal fees, lawsuits, fraud monitoring costs, and loss of trust. An example of cost saving possible with cybersecurity is a data security breach of Anthem’s systems in January 2015 that cost the company about US$375 million, which could have been prevented with cybersecurity, according to a report by KPMG.
Part
05
of seven
Part
05

Insurance Industry - Trends 5

Big Data Analytics and Digital and Omnichannel are some trends around the implementation of technologies and future capabilities in the insurance industry.

Methodology

We started by keeping updated with the trends that have already been mentioned from previous briefs such as AI, IOT, Telematics, Drones, Social media data, chatbot, Blockchain, and cybersecurity. With this in mind, we started the search for the two new trends by looking into reliable sites such as Insurance Blog, Accenture, Ey, WNS, and others. These sites are known to provide different tech trends that are currently helping the insurance industry. We were able to find the two top trends from this search. After identifying the two trends, we looked into how each is changing the insurance industry, how each trend impacts the entirety of the insurance industry, and how each trend creates potential savings for insurance companies. We also looked for two to three examples of US insurance companies that are currently leveraging on the two trends. We were able to find the needed information from various reliable sources that talked about the insurance industry in general.

Big Data Analytics

Insights are an essential tool for every insurance company, and big data gives this tool to them. Big data do these insights by collecting the needed information, calculating the given risks, and analyzing the provided statistics to deliver the appropriate premium and cover for the buyer. Big data also helps insurance companies by gathering customer insights (ex. Past policies of the customer), and also answer various questions that customers have regarding their insurance policies, premiums, and more. Overall, big data helps insurance companies by doing the statistical work for them, so that they may focus on customer experience instead.

Big data has also dealt a significant impact on the insurance industry by analyzing and halting false claims. It can track the client’s history and see the possibilities of claims being fake. This kind of information could help insurance companies make the appropriate decision for the given situation. Additionally, with all of this information, big data helps insurance companies and customers by making specific processes like filing a claim and setting policy premiums easier. In addition to this, the information provided by big Ddata also helps shorten claims and reduce existing labor costs.

Two insurance companies are benefiting from this trend is Cigna and Haven Life. Cigna has recently partnered with BodyMedia, a big data analytics company, to utilize their armband tracker for diabetes which is also part of their insurance plan. Haven Life is an insurance company that is benefiting from this trend by using big data analytics to plan and decide on policies by “using online questionnaires, prescription histories, and more.”

Digital and Omnichannel

Digital and omnichannel are a combined trend that helps improve the overall customer engagement of insurance companies. It helps better the quality and frequency of customer interactions, it brings customer and insurance companies relationships closer, and it also helps improve customer satisfaction and overall distribution relationships within the company. This trend has helped insurance companies by making customers stay longer in the company, and also smooth out the entire insurance process, reducing the time in various back-office processes.

Additionally, both digital and omnichannel are helping improve customer experience with renewals and accident claims. It does this by reassuring customers and giving the engagement they need with the company, to make them feel that they are part of the recovery process. Insurance companies consider the fact that accident claims are devastating for customers, and who are in a better field to reassure them than insurance company themselves? This not only improves customer retention and satisfaction but also help improve customer attachment with the organization. Overall, digital and omnichannel help reduce costs and speed the process within the insurance market. Additionally, insurance companies could use loyalty programs to leverage this trend and eventually save on expenses.

There are two companies that leverage this trend and these companies are StateFarm and AllState. StateFarm leverages digital and omnichannel by keeping their customers informed through their mobile app. They inform their customers about everyday things like driving routes, weather reports, and A/C filter changes, and they go beyond this by offering places in where customers could purchase their filter. Allstate leverages on this trend by recommending to customers about products that have helped them and the trend also helps maintain their relationship with their vast and growing customer base.
Part
06
of seven
Part
06

Insurance Companies

Executives at US insurance companies who have made statements about their plans to adopt different future technologies include: Dan Witalec, Progressive Insurance's customer acquisition lead; Charlotte Halkett, General Manager in charge of Communications at InsureTheBox; Brian O’Connell, Chief Underwriter at Savings Bank Life Insurance; Jeremy Carnahan, an executive at State Farm; and John Dugenske, Chief Investment Officer at Allstate.

They have spoken about the use of chatbots, telematics, big data analytics, drones and virtual platforms in different aspects of the insurance industry.

STATEMENTS BY EXECUTIVES AT US INSURANCE COMPANIES ABOUT ADOPTING FUTURE TECHNOLOGIES

AI POWERED CHATBOT

Progressive Insurance recently adopted Facebook messenger chatbots on their Facebook page, which has 4.8 million followers. Their chatbot is powered by AI to enable a quoting tool for auto insurance. This makes them one of the first US insurance companies to allow users to enter information and generate auto insurance quotes from within Facebook Messenger.
Dan Witalec, Progressive Insurance's customer acquisition lead said: “By creating the Flo Chatbot for Messenger we are able to make the process of getting an auto quote as simple as possible by ‘talking’ with them exactly where they are: on Messenger.”

USAGE BASED MOTOR INSURANCE (UBI) USING TELEMATICS

Telematics was the subject of a forum organized by The Digital Insurer at which Generali Group, InsureTheBox and other speakers talked about the use of telematics in claims. Using telematics provides new opportunities for proactive customer care, process improvement and better data for better decisions such as resolving legal disputes and eliminating fraud.

Charlotte Halkett, General Manager in charge of Communications at InsureTheBox commented that the industry is building faster processes around claims through the use of telematics. “One of the most exciting areas of telematics is around behavior modification, making customers safer drivers. We take speeders on our books through a very specific process, with particular communications related to excessive speeding. With this program, we’ve been able to reduce the risk in our speeding book by a factor of 15-times.” She added that InsureTheBox recently celebrated a milestone of 1,000 accident alerts triggered by telematics.

ADOPTING THE USE OF BIG DATA ANALYTICS

The Savings Bank Life Insurance Company (SBLI) a life insurer for families and individuals round the US, started using LexisNexis® Risk Classifier, an advanced analytics and predictive modeling solution to get rid of the need for invasive tests and accelerate underwriting. By using predictive modeling in underwriting, they have created strong customer relationships and established a competitive edge in the life insurance market.

Brian O’Connell, Chief Underwriter of SBLI, said, "Our mission is to offer affordable, dependable life insurance to all who need it. And to offer this to today’s consumers, we needed an innovative, faster and more affordable customer-centric process. With the help of LexisNexis Risk Classifier, we were one of the first life carriers in the industry to embrace the predictive modeling initiative and use it to improve our customers’ overall experience, which has enabled us to emerge as an innovator in the life insurance industry.

INSURANCE INDUSTRY USE OF Drones and AERIAL IMAGERY

Drones and aerial imagery are becoming important in the insurance industry, as insurers are integrating them in their disaster recovery procedures. State Farm, the first US insurer to be permitted to operate unmanned aircraft for commercial use by the Federal Aviation Administration, has been using drones for aerial roof inspections since August 2016.
Jeremy Carnahan is an executive at State Farm’s RedLabs Department, the innovation area at State Farm that focuses on new and emerging technology. He said that State Farm having its own in-house drone technology operation helps its customers and gives the insurer better and quicker access for inspections. "Being able to go in once the storm has cleared and gather a wide range of footage of the damage is very helpful in determining the damage allocation and where to deploy resources. It allows us the insight of how we can access the areas that are heavily damaged, he said.

INSURANCE COMPANY USING VIRTUAL PLATFORM IN THEIR CLAIMS

Allstate reported positive changes as a result of its move toward an integrated digital enterprise, QuickFoto Claim.

Self-service options are expected to increase, primarily driven by technology and millennial customer preferences. They found that virtual claims processing could increase process efficiencies, lower loss adjusting expenses (LAE) and enhance customer service. In addition, those insurers using virtual technology shortened their auto claims cycle time from 10-15 days to 2-3 days.

John Dugenske, Allstate chief investment officer said: The underlying combined ratio for the second quarter was 85.5. The underlying combined ratio for the second quarter includes $52 million dollars of restructuring expenses, primarily related to the expansion of QuickFoto claim, our virtual estimating platform. This expansion resulted in improved efficiencies and a closure of a number of claim drive-in offices."


Part
07
of seven
Part
07

Near Term Capabilities Versus Futuristic Opportunities

In the insurance claim industry, near term capabilities include the full use of AI, drone technology, smart sensors, and telematics. In terms of futuristic opportunities, more digitally-enhanced agents, smarter sensors, autonomous telematics, and other advanced tools will be employed in insurance claims processing.

Near Term Capabilities Versus Futuristic Opportunities

NEAR TERM: AI and Chatbots

In 2017, AI started to transform the insurance claim experience of the customers. It is expected that the use of this technology will further expand in 2018. As an example, the insurance industry is now experimenting with various ways to apply AI technology in the claims processing department. Insurance companies are hoping that technology can improve the experience of their customers by streamlining the process and reducing the claims processing duration. Furthermore, AI can also allow for better personalization in claims processing that can make the customers feel important, even without human intervention.

FUTURE: DIGITALLY-ENHANCED AGENTS

Comparing these AI developments in 2018 to the innovation predictions for 2030, the technology is expected to grow by leaps and bounds in the far future. For the year 2030, AI is expected to work more intuitively. For instance, upon first loss notice, innovative carriers can already use high-end AI analytics to classify and direct each claim to the right resolution department. Around 60% of the future claims are seen to be routine interactions that can easily be handled by an AI agent. The rest of the claims may need human agents due to complexity levels and the need for more empathetic interactions.
Furthermore, in 2030, insurance carriers can avail of highly adaptive technologies that can provide more proactive services. The intuitive multi-channel central hub can be used to instantly send next step and updates in anticipation of their customers' claim needs. Other preferred communication channels of the customers such as Snapchat, text messaging, and other applications can be integrated into the hub. Claim teams can input claims questions digitally into the hub and use video and data-sharing features to provide real-time answers. This technology is also expected to eliminate calling via phones.

NEAR TERM: DRONE USE

Drones were already used to assess the damages caused by four hurricanes in the United States in 2017. The aerial data provided by the drones enabled the insurance claims companies to quickly inspect the roof and exteriors of the properties impacted. The drones can easily go to the flooded areas that are unreachable by humans. This can give some useful information to the insurance claims' adjusters even before the flood receded. From 2017 to 2018, drones were more frequently used in these types of assessments. The benefits of using this technology can already be felt. One advantage is the reduction in the claims processing duration. Drones can also aid in productivity by freeing up the human effort involved in doing the routine inspection work in favor of more strategic and value-added tasks. This way, the technology can save some costs on the insurer's side as well.

FUTURE: SMART SENSORS

By 2021 and beyond, drone technology use in insurance claims processing can be further aided by smart sensors that can help determine in advance the potential problem areas. As an example, critical parameters such as wall strength, internal plumbing or pipe issues, defective wiring, and other home risks can be detected in advance by these sensors. Property owners and their insurers can then be notified of these potential hazards. These sensors can also set in motion automatic shut-off mechanisms and alert messages to emergency assistance entities who can provide immediate help. This technology is also currently available to a limited extent. In the far-off future, more developments can render the smart sensors to be more ubiquitous. This can then help in reducing the severity of the claims. The sensors can also help in gathering some critical data that can allow for more individualized claims servicing and profitable pricing structures. Furthermore, this risk prevention potential can improve the image presented by the insurers to their clients. The client will most likely stay with insurers who can help spare them the headache of going through crisis situations.

CLAIMS APPS AND OTHER TOOLS

There are many apps and other claim tools that were introduced in 2017 and 2018. The insurers continue to adopt these tools to meet their business requirements and their clients'needs as well. More tools are expected to be developed in the near future and beyond. Insurance companies now have more selections to facilitate claims processing. Some of the tools that are already being employed are the following: mobile image capture, intuitive processing platforms, customer communication tools, interactive automation, and case management tools.
In 2030 and beyond, the existing tools will become more evolved as more data and technical capabilities become integrated with these tools.

TELEMATICS

From 2017 and until the next year or so, telematics has been accepted as a standard for usage-driven insurance. The technology can give crucial data to the insurance companies, and at the same time, help the clients to drive more safely. The technology can also help the clients to reduce the premiums that they need to pay. As an example, this technology shows good potential in enabling more efficient claims handling. Telematics can also help in preventing fraudulent practices by employing real-time notifications. It can also help in speeding up the claims processing duration.
From 2021 and beyond, the telematics' features can be further enhanced. On top of the driving sensors, other safety sensors can be added into new car models as well. The final objective is to allow for a fully autonomous vehicle that can aid in reducing accidents.
Sources
Sources

From Part 04
From Part 05
Quotes
  • "FRAUD DETECTION Insurance frauds are a common incidence. Big data use case for reducing fraud is highly effective. Using big data in insurance, companies can keep track of past claims made by a client and the possibility of her claims being fake. "
  • "THREAT MAPPING When an insurance agency sells an insurance, they want to be aware of all the possibilities of things going unfavourably with their customer, making them file a claim. Setting policy premiums also becomes easy as big data provides organizations with ample information to analyze from."
Quotes
  • "Another example is from the life insurance sector; Haven Life (an online provider term of life insurance), enables the users to make quick decisions on policies up to $1 Million through online questionnaires, prescription histories, state motor-vehicle records and other data sources, using big data technologies."
Quotes
  • "To lower costs and ensure fairness, insurers often implement fast-track processes that settle claims instantly. But settling a claim on-the-fly can be costly if you overpay. Any insurer who has seen a rash of home payments in an area hit by natural disaster knows how that works. "
  • "By analyzing claims and claim histories, you can optimize the limits for instant payouts. Analytics can also shorten claims cycle times for higher customer satisfaction and reduced labor costs."
Quotes
  • "Omnichannel improves customer engagement to a large degree. Most of the time, well-designed/integrated channel interaction bridges the gap between customers & insurers and brings them closer, thereby, improving the customer retention rate."
Quotes
  • "Managing renewals and managing accident claims. The first is a fixed date in the insurance contract; the second is a variable which, if it happens, triggers the guarantees provided for in the policy. Both represent a critical phase in the customer relationship. Therefore, management of renewals and accident claims can become, from the insured’s point of view, an opportunity to evaluate their provider; for the company, it’s an occasion to increase engagement within an omnichannel customer experience strategy."
Quotes
  • "1. STATE FARM GROUP On their mission page, State Farm acknowledges their customers want a personalized experience. It’s not surprising they achieve it. Their collection of information is best seen through some well developed applications."
  • "2. ALLSTATE INSURANCE GROUP Allstate uses applications in their own way. Using their mobile app can use the geo-location feature to request assistance after having car trouble. They can also log all of their maintenance requirements and details which can help diagnose the problem."
Quotes
  • "Leveraging this sort of technological approach can also potentially save insurance providers money. Supporting apps and other digital tools that help policyholders stick to a dietary plan, cut down on smoking or drive more responsibly. "