It’s typically startups that get the credit for “redefining the insurance experience” for consumers. Indeed, many young insurance tech companies use technology to simplify time-intensive and paperwork-heavy tasks, like acquiring homeowner’s insurance, filing claims and navigating healthcare options. But that doesn’t mean innovation in the industry is solely driven by up-and-comers.
Established industry names are also using technology to improve the customer experience. Although these companies are sometimes thought to be slower to adopt technology, a 2019 McKinsey report noted that life insurance and property and casualty insurers actually spent more than one quarter of their annual operating budgets on technology in 2017.
We asked leaders at New York Life, Arity (a startup founded by Allstate) and MassMutual which technologies and trends they’re keeping an eye on to serve their customers, and one theme emerged: they’re thinking well beyond COVID-19.
Dave Castellani, Business Information Officer at New York Life Insurance
What technology or trend is your team watching closely right now and why?
Digital transformation is moving rapidly, but with a sharp focus on delivery. Microsoft CEO Satya Nadella recently stated that we’ve seen two years of digital transformation in two weeks. In some ways, he is correct in that companies have rushed tools to the market, but I question whether real transformation has occurred. The problem to solve is not digitizing, but to completely rethink how the customer wishes to be served in our post-COVID world.
For example, video is a highly useful tool, but decoupled from the full experience it is only a tool. Intelligent information through data analytics will become even more important, but which insights are most critical and why?
Finally, sharing information in a seamless, highly secure and controlled fashion will be in demand — but it’s complicated. Buying financial assets, for example, involves the customer, an agent and often an accountant and lawyer. Workflows for version controls can be sophisticated and the “vault” where these documents reside must be secure.
“The problem to solve is not digitizing, but to completely rethink how the customer wishes to be served in our post-COVID world.”
Is there one trend or technology your team is currently watching that no one is talking about?
The trend few seem to see and understand is CRISPR, the breakthrough approach to editing genes. While everyone watches robotics and AI, CRISPR will likely be the most disruptive technology of our generation.
The ability to solve diseases and enable people to live longer would have tremendous implications for the life insurance industry, as it directly relates to the products and financial protections the industry provides and the business decisions that industry participants make. Keeping our finger on the pulse of these potentially game-changing technologies concerning people’s health and longevity is crucial.
Katie DeGraaf, Director of Mobility Intelligence at Arity
What technology or trend is your team watching closely right now and why?
We are watching how COVID-19 impacts driving behaviors, especially as they relate to risk. We have analyzed more than 280 billion miles of data collected across more than 23 active driver connections, including consumer apps and mobile and on-board device programs. We’re focused on providing helpful insights around changes in driving behavior to a number of industries, but insurance in particular. It’s critical to understand how risk has changed and how COVID-19 cases and state and federal regulations impact behavior.
The industry very much saw a need to respond at the beginning of the pandemic, and we sought to provide support by asking questions like: Are people driving more or less miles? For those that are driving, are they taking more or less risky roads? Are they speeding more, driving distracted and getting into accidents?
Most importantly, we’re focused on understanding the long-term impact COVID-19 will have on driving in 2020 and beyond. Our goal has always been to make sense of how people move so that businesses can better serve their customers. We can’t think of a better time than now to lean into that.
“Most importantly, we’re focused on understanding the long-term impact COVID-19 will have on driving in 2020 and beyond.”
Is there one trend or technology your team is currently watching that no one is talking about?
Our team is also heavily focused on the speed with which digital changes will be needed, especially in the insurance industry. As of May 1, total miles driven have decreased by an average of 44 percent, but in some states miles traveled are down as low as 14 percent, while in others the decrease is as much as 75 percent. We have also seen a nearly 30 percent increase in the rate at which people are driving over 100 mph. So, while there are less people on the roads, how people are driving is definitely shifting, meaning overall risk on the road has changed.
These shifts reflect how the economy has been and will continue to be impacted by the pandemic, and people will need more control and flexibility in their lives. Insurers have made some strides toward more digital and controllable insurance experiences by offering customers mobile apps and usage-based insurance. But this time is teaching us that both consumers and businesses can and must adapt. For insurers, this means putting their foot on the gas to develop necessary modernizations for customers.
Tina Whitney, Digital Lead, Enterprise Technology and Experience at MassMutual
What technology or trend is your team watching closely right now and why?
One technology that we are watching is next-generation authentication, or NGA. It is important that we build our digital products on a solid foundation that protects our customers’ data, while also providing a great experience with the least friction possible. This means relying less on passwords and more on both user behavior patterns and biometrics.
Currently, we employ two-factor authentication and identity proofing patterns, and we are constantly innovating. NGA will be the next evolution of our authentication product. What this ultimately means for our company and industry is less fraud and more customer engagement, both of which have bottom-line impacts.
“One thing we’re focused on that’s considered groundbreaking in the insurance arena is predictive behavior analytics.”
Is there one trend or technology your team is currently watching that no one is talking about?
One thing we’re focused on that’s considered groundbreaking in the insurance arena is predictive behavior analytics. Predictive behavior analytics can lead to a reduction in fraud, and also provide real-time insights that increase customer engagement while reducing abandonment rates.
