2017 looks set to be another big year in technology. However rather than any big new inventions taking centre stage, this year will focus on improving existing technology such as machine learning, mobility, virtual reality, IOT and automated finance. Don’t let this fool you, 2017 will most definitely be an exciting and life-changing year for technology. Some of the more farfetched tech products will be given the chance to refine their concept and become more functional, increasing their adoption in everyday use.
What does this mean for your insurance business? The market is intensifying their comfort with technology. People now demand everyday processes, such as purchasing insurance, be more efficient and convenient through digital channels and current technology. While they may not vocally demand it, they will certainly be making their preference clear with their wallet [See post Easy Always Wins]. It means that in 2017 there is no better time to embrace new technology for your business. The story on the failure of Kodak is a very real reminder to respond to the market and not fear.
Here we list which technologies we predict will have the most impact in 2017 and the benefits they can deliver to businesses.
Mobile Payments and Automated Finance (Fintech)
The future of finance is looking rather robotic. Bank branches continue to close across Australia and the rest of the world as customers opt for digital banking channels. According to a Citigroup report, 30% of finance jobs are predicted to be lost by 2025. The cause behind this movement is a selection of automated finance technology including but not limited to Paywave, Mobile Payments, Robotic bank tellers, and even AI Systems that assess and payout insurance claims.
With Australians clocking up over 28 million transactions a month with ‘tap and go’, and 84% saying they would use a smartphone to make a payment if the option was available, it is clear that convenience is key when it comes to payments. While Insurance Brokers may never need to provide mobile payments or tap and go as payment options, it would be wise to consider what payment options you do offer. Making them more convenient could set you apart from your competitors.
Big data and machine learning
Many companies have been implementing “big data” for some years now. In 2017 however, we are likely to see big data get even bigger. An increasing number of businesses are adopting machine learning technology into their marketing strategies and buyer’s journey. Requiring a shift of focus from quantitative information to qualitative information, data will only increase in the strive for machines to record and learn people’s behaviours.
An example of Machine Learning is the list of recommended videos YouTube gives you based on your viewing history; a computer being able to understand speech is another example; there is even a bed that streamlines your sleep based on machine learning.
Ways in which Insurance Brokers can embrace Machine Learning is online suggestive selling. Similar to the structure of Youtube’s recommendations, brokers can set up their website up to make cross-sells based on the customers’ purchases or personal information.
Virtual Reality, augmented reality and mixed reality
Now the initial buzz has died down, how will Virtual Reality be used? Although at its core VR is a gaming technology, it has many other valuable uses, including some that would benefit businesses. When Facebook Founder Mark Zuckerberg purchased Oculus back in 2014 he envisaged VR being able to deliver more simple life pleasures, such as ‘…enjoying a court side seat at a game, studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face – just by putting on goggles in your home,’ Zuckerberg declared via a Facebook post at the time. Because VR, AR and MR will rely on other domains, its limits are almost endless. We see its biggest potential in training and education. Imagine a 16 year old learning how to drive , a medical student navigating the human body through a technological replication, or a new employee going through occupational training, all via VR.
Not convinced? According to a 2016 report from Tech Pro Research, 67% of businesses are contemplating using AR in the future, and 47% are contemplating VR for the future. How would Insurance businesses use AR or VR? Imagine being able to immerse clients into the scenario in which they would need to make an insurance claim, such as walking through a flooded house, or seeing the aftermath of a car crash as if they were actually there. VR could influence the way some people think about insurance and its value, something which is often hard to discern without something tangible.
Insurance still remains one of the few financial industries to be ‘disrupted’. Some argue its not just the technology aspect of insurance that needs updating (Insurance is keeping the paper industry alive), but the products too, as many do not reflect the booming sharing economy. This leaves a big opportunity for start-ups to take advantage of. While many investors are claiming insurtech to be this year’s hottest investment, it has been a little slow to take off due to the complex nature of insurance. Nonetheless, there have been an increasing amount of insurtech companies emerging [Read: Is 2017 the year for insurtech?], and we think 2017 could be the year they start to make a real impact.
Some Insurance businesses have already been embracing insurtech. For example, apps and devices that monitor consumer behaviour are being applied in effort to reward customers that are actively healthy or cautious drivers with lower or pay-as-you-use premiums. Another example is insurance businesses giving their clients extended control over their insurance and related transactions, such as Online Quoting or Customer Self-Service. Peer 2 Peer Insurance is also gaining popularity, and is in the position to shake up the insurance industry in 2017.
The Internet of Things (IOT)
Business Insider Intelligence estimate over 20 billion IOT installations by the year 2021. According to the site we were at 6.6 billion installations in 2016. Needless to say, we can’t see IOT going anywhere. But what will be its most popular forms? Both Google and Amazon have recently released their home technology systems for the ‘smart home’, and are quickly gaining popularity. Other IOT gadgets include Smart Locks, environmental sensors and wearables. All of which it is sure to have an impact on businesses in 2017, particularly the insurance industry.
What might be of particular interest to insurance professionals, is IOT’s preventative abilities. Whether it be a fitness tracker which can inform the insured of their current health status and encourage more fitness or a visit to the doctor, a smart stove that knows when it’s been left on and can turn itself off, or a ‘smart home’ informing their owner of flooding; the possibilities when it comes to the IOT are endless. We have no doubt IOT will bring many changes to the insurance industry this year and future years.
Tell us which digital inventions you think would benefit you or your business most. We’d like to hear from you!