In the decade ahead, the insurance industry could look completely different to what it does today, driven by technology, data and new business models that could potentially disrupt the sector.
“We are in the path of something as big as the Industrial Revolution for insurance,” states Maximiliano Hidalgo, Director for the Financial Institutions Group, Global Banking, Asia-Pacific at HSBC.
“In Asia, you have the luxury of not having legacy models, where the insurance industry is developing very fast. Clients now want a service that is agile and frictionless. Over time companies are going to be offering clients a lot more touchpoints to interact with them.”
Premiums in emerging Asia are estimated to have continued robust growth above 20 per cent in 2017.1 Insurtech premiums, those generated via mobile or the web, in China alone will reach over USD174 billion by 2020, according to one estimate.2 This is one of the world's biggest and fastest-growing markets for insurance products.
The industry could also see a shift from being a claims payer to a risk mitigator over time: “We will look to help the customer understand how they can avoid a claim or how they can live a healthier life, say with less risky driving behaviour,” states Dr Ladina Caviezel, Head of Digital and Smart Analytics Consulting for Asia-Pacific at Swiss Re.
Future solutions are likely to be data-driven with the industry collaborating with technology or healthcare providers to mitigate the risk. Artificial intelligence could also be used to simplify manual processes.
“The future involves complementing our existing underwriting information with behavioural data,” says Chris Wei, Executive Chairman, Global Digital for Aviva Asia & Friends Provident International. “This is where the true battleground will be fought and won in the insurance industry.”
The mindset and the culture of the insurance sector is also changing very quickly with a clear focus on customer service. This is increasingly powered by data analytics and technology. “In the next ten years the industry will basically look completely different to what you see today,” states Mr Hidalgo.
1 Global insurance review 2017 and outlook 2018/19, Swiss Re Institute
2 China Insuretech Market Report, Oliver Wyman
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