As an industry, insurance has the reputation of being conservative — which makes sense, given that the point of insurance is to defend against risk. 

But even insurance is being swept up in the technological revolution, with the Internet of Things, artificial intelligence, robotics, telematics devices and other advanced technologies impacting the way the industry operates.

One of the effects of advanced technology has been the rise of the flexible workforce, where employees choose the hours, locations and jobs that suit their personal schedules. That same technology is empowering insurance companies to offer new products that match the needs of the flexible workforce — enabling them to issue policies that cover specific activities that are valid for specific time periods.

For example, if a driver for Uber, GrubHub, DoorDash or another gig delivery firm is working just four hours a week, the insurance company can lean on technology to issue a policy that will completely cover the driver for that time period instead of issuing a less fine-tuned global policy that would have covered the driver full-time, as has been the case until now.

Today, with the advent of advanced technologies, insurance companies have the opportunity to deliver personalized products that will provide each client — be it an industry, a company or even an individual — with the insurance they need to ensure that they are protected without over-insuring, overpaying or overloading themselves with unneeded policies.

Here are a few ways advanced technologies can help both customers and insurers, especially those with flexible workforces, offer the best policies and provide the best services.

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On-Demand Insurance 

Smart devices today come equipped with a plethora of connective technologies, including GPS, motion sensors, and 5G connectivity that provide always-on data about locations and activities. With the consent of users, of course, insurers can offer companies policies based on worker activities.

Organizations with flexible workforces that employ part time or contract workers — like firms that fulfill and deliver food orders whose drivers who work on their own schedules without set hours — could use devices to “turn on” insurance coverage when it is needed. Companies would pay premiums for their drivers only when they are actually driving, cutting costs significantly and enabling them to provide solid policies for workers who would have otherwise have had to purchase much more expensive policies on their own.


IoT for Individualized Insurance

Wearables, traffic lights, streetlights, cars, connected home smoke alarms, GPS-equipped devices: All of these are already in use, collecting reams of data that could potentially be used by insurance companies to develop very specific and detailed actuarial tables that are based on lifestyle, work situations, home environments, driving habits and more. - 

The data from these devices can help design individualized policies tailored specifically to clients. If drivers for a service demonstrate safer driving habits — proven by real-world metrics that reflect those habits — insurers can then offer that service lower premiums.


Keeping Clients Safe

Artificial intelligence and machine learning can help insurers keep their customers safer. For example, if a delivery company that insures its drivers — whether it provides full-service policies for its full-time drivers or offers the on-demand insurance model for its flexible workforce — is experiencing a spike in accidents or traffic mishaps, AI/ML systems can crunch the data collected by connected devices to recognize patterns that would explain why the accidents were happening. Based on that analysis, the insurer could make recommendations to the company that would help reduce the number of accidents (and therefore the number of expensive claims.)


Reducing Insurers’ Exposure

Advanced technology can also limit insurers’ exposure to fraud. AI analysis can help flag suspicious claims, enabling them to root out fraudsters, saving money on false claims.

Like in so many other industries, technology is changing the way insurance operates. This newfound flexibility gives insurers opportunities to reach the types of customers they would have had a great deal of difficulty engaging with in the past. And thanks to the same technology, customers can better protect themselves and ensure that a mishap or accident doesn't bankrupt them. That means that both insurers and clients are getting a better deal — because insurers are offering clients tailor-made policies, and clients are paying only for what they need. 

As the way we work continues to change, insurance needs to change, too, through the same digital revolution that is transforming industries the world over

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