As we head in to 2021, Ebix have decided to take a look at what we think are going to be the top 5 trends for the insurance industry in 2021.
Hard market conditions
According to Artificial, hard market conditions will be one of the biggest insurance trends in 2021. We agree with their theory.
“Insurers in 2021 will be no doubt erring on the side of caution, introducing new coverage limits and adding new terms and conditions to policies to ensure they aren’t hit too hard by any potential further waves of Covid-19.”
“Higher rates might be par for the course in 2021, but insurers will no doubt double down on their efforts to add value and ensure that customers don’t move away when premiums rise.”
Retention of customers will be paramount in 2021 and insurers know they won’t want to lose any valuable customers. Premiums could be expected to rise as mentioned above, however, clients will benefit from the improved efforts to keep them satisfied. Companies that take on feedback from their clients will have the most success in retention.
For a full list of their predictions, check out the article here: https://artificial.io/company/blog/7-insurance-industry-trends-for-2021
Customised policies (data driven)
Data, data, data! Data is becoming more readily available to insurers, with that comes the ability to create customised policies tailored to suit the needs of individuals. The benefits go both ways, to the insurers and the clients. Insurers are able to reduce risk by understanding their client’s backgrounds and actions. In addition, clients will benefit from the accuracy of insurers who will have more consideration and detail in the underwriting process.
Client’s privacy will still remain a contentious topic and the ethical gathering of data. The collection of this data can come from many different sources such as social media, the internet, credit reports and previous claim history. The hope is to combine all information as to accurately customise policies for clients.
SaaS cloud technology can be used with an agile IT model to deliver new applications and software which brokers will need to make the most of big data and to engage with customers in 2021’s tech-driven market.
One of the biggest blessings to come out of 2020 was our ability to reply on our technology. We not only needed it, but thrived with the advancements. Cloud computing and particularly Software as a Service (SaaS) has been evolving and developing, 2021 could see this evolution taken to the next step.
Brokers are becoming more used to agile and flexible software models that allow the ability to connect from anywhere and through different devices. From large scale organisations to SME, mobile applications as well as the freedom to access and effectively use insurance software will play a considerable role in the post COVID-19 world.
Keep an eye out in 2021 to see what is coming NEXT in insurance software platforms from Ebix.
More and more businesses are looking at Cloud options as a means to streamline operations, reduce capital expenditure and increase operational efficiencies. The effects of Covid-19 have also changed the way businesses operate with many staff forced to work remotely and have secure and reliable remote working options available to them.
Find out more about Ebix cloud hosting software: http://cloud.ebix.com.au/hostnow
Weather events will drive an increase in disaster related claims
The change in weather conditions with the shift to the La Nina weather system could see an increase in disaster related claims. The 2020 bush fires proved the importance of disaster related policies. Insurers all around Australia were forced to take action and evaluate their policies and conditions. 2021 could see claims based on natural disaster events that have already begun due to heavier rain fall periods and cyclones.
Bloomberg’s recent predictions about COVID-19’s impacts on the insurance industry had this to say about the impacts of extreme weather events:
“Recent weather trends, signs of climate change and ever growing exposure in high-risk areas suggests the industry will likely continue to see this demonstrable increase in the frequency and severity of natural-disaster related claims. While loss mitigation opportunities improve, insurers will need to continuously assess risk and implement proactive strategies to address operational challenges and manage risk for businesses and consumers.”
A virtual world
2020 was all about zoom meetings and connecting people via distance. The insurance industry was no different and technologies had to be created for virtual inspections and contact without face to face meetings.
This leads on to cyber security insurance risk as more transacting and interaction happens online, the need for safer technology methods has increased significance. As mentioned earlier 2021 could be the year we see insurance heavily reliant on data, however the cyber security and protection of that data needs to be improved against hackers.
At the end of the day insurers will have to be transparent and ensure customers feel secure about the data they own.