InsurTech refers to the use of technology to innovate products and solutions to further enhance the operational efficiency and business model in the insurance industry, which involves internal business processes, product, distribution management and more, with the aim of optimizing customer experience for policyholders. Adopted in new trends such as online insurance and remote insurance, InsurTech has emerged as a disruption in the insurance industry in recent years, which has been brought to people’s attention and prompted changes in laws and regulations in response to the new wave.
The InsurTech market is expected to thrive; according to Forrester’s Q3 2021 report, InsurTech funding has reached a record high of $15 billion as of the third quarter of 2021, which has even surpassed the sum of 2019 and 2020. Moreover, the latest report released by the IT service company Capgemini has pointed out that an investment of $255 billion (£187 billion) in end-user technology and IT services is expected from the global insurance market by 2022, which suggests a significant growth of InsurTech demands.
Insurers have been engaged in digital transformation over the years despite numerous challenges to overcome, especially under the impact of COVID-19 pandemic. To respond to the ever-changing market and demands, the importance of digital technology can’t be overemphasized. Let’s move on to look at the top InsureTech trends to watch out:
The insurance industry is still facing various challenges due to the economic impact of the pandemic for the past two years; nevertheless, consumers are getting more and more aware of the importance of insurance. According to the world insurance forecast of the Swiss Re Institute, the global insurance demand will grow by an above-trend 3.9% in 2022.
In the article “2022 outlook: Setting a course for the coming decade“, McKinsey provides insights into the InsurTech trends: In 2020, 44% of consumers showed interest in buying insurance from tech companies, which is a substantial increase from 7% in 2016. While traditional insurers are being disrupted by the InsurTech companies entering the market, they still benefit from their advantageous position in the ecosystem through clear digital transformation strategies to achieve business growth.
An uncertain economic environment may continue, and insurers need to quickly take responsive actions to stay competitive and provide optimal insurance services. Consumers are looking for new forms of insurance fueled by InsurTech solutions. To learn more about how we can help you achieve the best results, please reach out to us.