The Future of Insurance: Top Insurtech Trends for 2024
More than 85% of insurers are deploying CX initiatives throughout the
customer journey, as the industry perspective shifts towards customer-centric
business strategies. As per the policyholder’s POV, over 75% of customers
expect companies to bring in innovative technologies to improve experiences,
according to a report by Salesforce.
This blog delves into the top Insurtech trends for 2024 that insurers should
look out for. We will also go over the current state and future predictions for
the insurance industry, that will help insurers plan their digital transformation
to suit the dynamic market needs. Read till the end to learn about the role of
technology in staying ahead of customer expectations as insurers prepare for
an exciting year ahead.
Future of Digital Insurance: What’s up ahead?
The industry is expecting turbulence on multiple fronts in 2024, caused by the rise in property and auto rates due to inflation, geopolitical imbalance, and increasing scrutiny of insurers' ESG regulatory compliance. As industries around the world prepare to tackle these challenges, it will not take long before its ripple effects reach insurers’ doorstep.
“Insurance companies expect tough and volatile macroeconomic conditions will have a major impact on growth and margins in 2024.”
Insurance Consulting and Technology at WTW (SRC)
Furthermore, according to a recent CIO survey by Gartner, 58% of insurance respondents reported increased digital innovation funding, sparked by the pandemic. This means the business automation trend catalyzed during the COVID-19 pandemic, will carry on as Insurtech trends in 2024 to help insurers boost business performance with the help of modern technologies that integrate seamlessly on top of their existing digital infrastructure.
8 Insurtech Trends Insurers Should Look Out For in 2024
As insurers prepare for the turbulent waves heading towards the industry in the coming year, technology emerges as the guiding sail to help insurers tackle the storms up ahead. As customer-centric business strategies shape the way insurers approach digital transformation to make data-driven decisions, insurance technology trends that enhance customer experiences will gain the most traction in 2024. Without any further ado, let us dive into the top Insurtech trends for 2024 that insurance providers should look out for!
Web-Embedded Insurance Sales
To simplify the complex process of policy coverage and benefits customization, insurers are looking towards web-embedded insurance sales. By embedding insurance products at the point of sale (POS), insurers can market their key offerings right at the time of purchase.
“We can see that insurance and protection will go hand in hand with core business propositions.”
EMEA, Cover Genius
It not only reduces the time to make a sale, but also maximizes the potential market for insurers and broadens
their reach. Currently embedded insurance is already in practice for travel and auto insurance, but with the
coming year insurers will move towards expanding the scope of their offerings with the help of web-embedded
insurance sales.
Related Read: The Ultimate Guide to Insurance Distribution Management Software (2023)
NLP & AI-Powered Chatbots for Insurance
Another Insurtech trend redefining the way insurers engage with customers is Natural Language Processing
(NLP) and Gen-AI-powered chatbots. While Gen-AI empowers customer interactions via swift and curated
responses, NLP enriches the whole experience and offers insurers the opportunity to expand their reach to new
horizons and market segments.
75% of users prefer using chatbots when looking for answers to simple questions, whereas 65% consumers
feel comfortable handling an issue without a human agent. Therefore, AI-powered chatbots for insurance that
are trained on insurance-specific queries, will be a key differentiator for the industry, when deployed with
human-in-the-loop validation.
“We’re already seeing the benefit of gen AI in various workstreams across the insurance ecosystem, and we see accelerated adoption of responsible and explainable applications in 2024.”
(SRC)
AI-Driven Data Analytics and Decision Making
Talks about making the most of customer and business data to improve business decisions have been floating
around for several years now. However, 2023 has been the year when we started seeing widespread
implementation of technologies focused on data analytics and visualization. While businesses across multiple
industries are venturing into the world of AI-driven data analytics, for the insurance industry, this trend is still
in its infancy.
Due to its significant benefits for both the front and the back office, AI-driven data analytics is one of the major
Insurtech predictions for 2024. Insurers are already prioritizing technology partners who offer integrations with
legacy tech, to ensure that their invaluable customer data has a place in guiding the future of the business.
IoT and Telematics for Customer Data Capture
As the adoption of Wi-Fi-enabled devices and electric vehicles grows, insurers can gather data collected via IoT
and telematic devices to improve underwriting decisions. Moreover, with real-time data coming in from multiple
customer touchpoints and beyond, insurers can optimize their products and services to better align with the
needs of the customer and offer personalized services.
According to Insurance Thought Leadership, the insurance telematics market is expected to grow from $5
Billion in 2023 to $11 Billion by 2028. Insurtech companies with solutions that can help insurance companies
capture, integrate, and analyze the data from IoT and telematic devices, will be a top focus for auto insurance
carriers, among others.
Hyper-Personalization of Insurance Value Chain
As users get accustomed to personalized experiences in all aspects of their lives, from grocery shopping to
automobile purchases, the standard of consumer experiences is being raised at a magnificent pace.
To keep up with this shift in customer expectations, insurers will need to implement mechanisms that support
the rapid personalization of offerings to each customer based on their preferences.
With the help of Machine Learning (ML) algorithms and Gen-AI insurers can leverage technologies that enable
hyper-personalization in real-time by analyzing customer behavior data to gather insights that can optimize
insurance products to suit their needs.
Cyber-Security Risk Assessment Tools
Pattern recognition and predictive capabilities of AI are key points of interest for the insurance industry,
as it can not only prevent fraudulent claims by analyzing historic user data but also assess potential risks during
underwriting or while evaluating customer risk profiles.
As businesses across the world become more digitalized, the threat of cyber-attacks is also evolving such as
data breaches and ransomware attacks, leading to a higher demand in cyber insurance. Insurtech providers
with technologies that assess cyber security risks accurately will be in demand in 2024 and beyond.
Solutions that leverage blockchain technology can support in ensuring transparency while streamlining the
claims and payment processes for both insurers and customers.
“The tools we use to predict and analyze these digital threats are improving, and more organizations are seriously strengthening their security defenses.”
(SRC)
Automated Digital Document Processing Solutions
The insurance industry is still largely dependent on paper-based documentation for most of its workflows,
be it insurance applications, underwriting, risk profiling, or claims. With a daily influx of bundles of documents,
insurers are faced with a dire need to rapidly digitize their documentation processes, to improve the speed and
efficiency of their services. Traditional paper-based documentation process requires manual data entry which
is susceptible to human error and takes up a lot of the agent’s time.
Moreover, automated document processing allows insurers to cut down operational costs by freeing up resources and boosting workflow efficiency. Intelligent document processing solutions that enable insurers to reduce the number of document uploads by the user, while minimizing errors and improving data synchronicity, will be the most rapidly growing insurtech trend in 2024.
Low-Code Digital Infrastructure Transition
Insurers are shifting from a traditional in-house deployment to a cloud-based deployment approach for business
applications, for lower cost of ownership and faster resolution of application change requests. Speaking of
change requests, another significant transition that we have been noticing in the industry is the widespread
adoption of low-code software development strategies.
Compared to its traditional counterpart a low-code software development approach allows insurers to be more
involved in the application creation process, as it helps in bringing the world of business and tech together. With
the help of low-code app development platforms, businesses can visualize user journeys in real-time and
orchestrate workflows according to their specific needs, without waiting for a software developer to implement it.
A cloud & API based low-code infrastructure offers significant benefits for insurers who are looking to
transform their digital infrastructure, by cutting down costs and accelerate deployment while ensuring
efficiency, transparency, and real-time implementation.
What’s Next?
The good news is despite the challenges the global insurance market is predicted to increase by approximately 10%. Insurers are looking to capitalize on the rising Insurtech trends for 2024 mentioned above to gain a competitive edge in the market. In addition to the trends we covered, there are a few other honorable mentions that deserve insurers’ attention such as, regulatory technology or Regtech, to cope with the rapidly changing regulations, technologies that enable accurate risk assessment as the demand for parametric insurance rises in 2024, and lastly collaborations between insurers and technology providers will surge in 2024 in an effort to accelerate innovation.
Why Neutrinos?
Whether it is a small API integration or engineering a complex enterprise-grade application, when it comes to implementing Insurtech trends insurers
need rapid delivery and futureproof technologies to meet the ever-changing market needs. Insurers who are still dipping their toes into the endless sea
of possibilities of digital insurance, need a reliable partner to support their transformation journey.
That’s where we come in!
With our Full-Stack Low-Code Digital Innovation Platform, Neutrinos is helping insurers around the world reimagine business efficiencies. The
Neutrinos Platform comes with an infinite capability canvas that lets you orchestrate digital user journeys in real-time and bring your digital vision to
reality, in an end-to-end cloud-legacy-hybrid ecosystem.
With hundreds of pre-built insurance-specific accelerator blocks on the Neutrinos platform, insurers can seamlessly integrate modern capabilities
such as Data Synchronization, AI-Driven Analytics, and insights, connected Claims processing, intelligent document processing and so much more.
With decades worth of experience under our belt, in both technology and insurance ecosystems, we are helping insurers around the globe transform
the lives of their customers, with tech that is purpose-built for the insurance industry.