Insurance 4.0
From the steam-powered factories of the first industrial revolution, to mass production in the second, to the rise of digitization in the third, every advance builds upon the last. Today, something entirely new is happening. While the first three revolutions were defined by a handful of industries undergoing rapid change, a fourth industrial revolution is emerging from an explosion of new technologies affecting nearly all industries simultaneously. Divisions among physical, digital, and biological spheres are blurring. Before, technology automated individual tasks. Today, technology is connecting – and reshaping – whole societies and economies, and changing what it means to be human.
What is Insurance 4.0?
Many companies have set up new points of contact with their customers, creating a digital customer journey that reflects the needs of end users that are increasingly connected, informed and digitized, in continuous transition between the physical and the virtual world.
Insurance market players are now faced with a new insurance 4.0 that will enable them to become part of a new ecosystem, generated in turn by the development of connections between traditionally separated sectors. In the near future, the user experience will be increasingly driven by new technologies and artificial intelligence systems, which will play a key role in this evolution, enabling the creation of a professional-consumer relationship based on smart, dynamic interaction.
4.0 Technologies for Insurance Industry
Artificial Intelligence
While insurance products are increasingly researched online, insurers have struggled to replicate the sales effectiveness and persuasiveness of a human broker or agent. But this may be changing. “Robo-advisors” – AI-powered chatbots driven by predictive analytics and natural language processing – can communicate with prospects clearly and adapt offers to an individual’s unique needs. This insurance-specific technology can help sell more policies, generate reminders to clients, and automate and simplify claims management. In the interests of transparency, it is important that AI-led decision be explainable to consumers.
Big Data & Analytics
While many innovations of the fourth industrial revolution represent splashy customer-facing opportunities, others quietly enhance business efficiency. Consider RGA’s Risk Dimensions portfolio, an approach that combines predictive models in unique ways to interpret and analyze vast amounts of information. For example, the company partnered to develop a credit-based insurance score is predictive of mortality and lapse risk and can accelerate individual or group life underwriting. This can be applied as a stand-alone product or in tandem with prescription, digital health and motor vehicle scores to further refine risk assessment and overall mortality experience.
Internet of Things
Insurance-linked wellness and eldercare programs can already improve the life and health trajectory of consumers. For example, some companies has partnered with eldercare providers to advance technology solutions for healthy aging – monitoring health metrics, preventing social isolation, and providing personalized coaching. In so many ways, technology’s role in our health and wellness is evolving – getting smarter, more efficient, and more effective.
Robotic Process Automation
Staffing shortages are also fueling advances in robotics. Japan, ranked by Hays Global Skills Index as one of the countries with the most acute skilled labor shortage, is home to “Pepper.” Developed by Meiji Yasuda Life Insurance Company, Pepper provides information about products and services at the carrier’s branches, accompanies salespeople, and appears at insurance seminars. Robotics could offer one solution to a widening talent gap across the industry.