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There is a reason, as all insurers know, why standardized insurance policy forms are necessary. The foremost is that every state has its legal requirements about insurance policies. Further, premium rates are based on actuarial studies of insurable risks and they also incorporate previous court rulings. Instead of 400 Insurers, each having their analysis systems it is much more dependable leaving it to specialty organizations. This is why standard insurance policy forms are drawn up by insurance advisory organizations with no compulsion on the part of insurance carriers to use them.  However, customization and the addition of new features to meet new requirements are necessary.  Proprietary forms in insurance  can have more restrictive or even much broader terms than ISO or other standard forms. Either way, is your insurance software system able to support your company with standard and proprietary forms? Before we look into the software side, a quick look into why these forms can r

Technical debt matters because insurance runs on technology. Some technical debt is inevitable, but it moves from an important topic to an urgent one when it adversely impacts the balance sheet.   When technical debt is steep, it can present substantial risk.   Systems that are closed and unable to connect with the latest innovative platforms and third-party technology might be giving an impression of business as usual while piling up extra cost from inefficiencies. Managing technical debt in insurance systems needs to begin by understanding the impact it has on operational efficiency. The new definition of technical debt Technical debt is what you should be spending on innovation compared to the money you are currently spending on keeping inefficient systems running . Insurance carriers have accumulated a great number of different systems and different technologies over the years. Underlying all this is an undeniable truth, that it costs a lot of money to keep these systems going a

Not all bots are chatbots. A bot is a computer application designed to automatically perform repetitive or logic-based tasks and a chatbot is the same thing but with the focus as simulated conversation. Bots are not a new concept, even though the benefits of chatbots in insurance is gaining more acceptance in the last few years.   Search engines like Google  were the early movers, using bots to analyze content and index the web - a feat that would be impossible for humans to accomplish.  Insurance bots hold the promise of easing the complexity of insurance transactions. Over the next decade, bot technology (including chatbots) will play a bigger role across the insurance value chain. The different ways Insurers are using bots Geico  uses a mobile virtual assistant “Kate” to provide answers to policy coverage and billing questions.  Lemonade Insurance Company  has ‘Maya’, their insurance chatbot that uses plain English and brought 70,000 customers online in their first year, with no

Data-driven organizations in the U.S. have a 23 times higher probability of using data to acquire customers than those that don’t. Insurance carriers have no dearth of data and what can set them apart is their capacity to mine their data for better insights. Here is the reality though, a study conducted by T he Economist Intelligence Unit (EIU) of 200 banking and insurance C-suite leaders   found that while there is strong confidence in the benefits that AI can bring, only 15% said that AI is used extensively throughout their organization. This ga p though is bound to be soon filled, with  89% of North American respondents saying they plan to invest over the next five years   in incorporating insurance data analytics for better predictions of their big data.  Here are some more interesting insights for AI-fueled growth opportunities in the next 5 years: 27% of C-suite executives say AI will open up new products and services 25% expect it to lead the way in opening up new market

All insurance policies have depended upon criteria like medical assessments and employment status to determine an individual’s risk level. The higher the risk, the higher the insurance premium. But with advancements in technology, additional data is now available for underwriting and claims processing.  Social media has penetrated almost every aspect of our lives. A majority of us have at least one social media account and we regularly share updates on our profiles for our connections to see. But beyond posting the perfect shot of our breakfast, can social media actually be a tool for insurance companies to evaluate an individual and determine their insurance premium? The use of social media posts as credible research sources is a legal method in insurance processes. Shouldn’t, social media scoring be a part of your agent’s routine background assessment process or in claims processing?  Social media scoring could be faster than traditional approaches Social media scoring cannot be

Smartphones today have become a permanent fixture for each of us, always within arm’s reach.   Statista’s research   indicates that in 2022, we will be spending, on average, 227 minutes each day on these little handheld screens. New technologies like 5G and edge computing will make us even more anchored to our devices. The flexibility that insurance mobility offers is increasingly important in a market where carriers need to differentiate themselves by the experience they offer and not just their products. New technological advances in the field of mobility and telematics technology offer exciting new avenues for innovation. But regulatory constraints and legacy infrastructure mean that most insurance carriers cannot simply develop mobility solutions overnight.  The more achievable path to technological modernization would be to adopt a bite-sized approach. Knowing how to begin is important, after all, a journey of a thousand miles begins not with the first step (as the saying goes) ra

  The insurance sector today looks like it’s on the same path of transformation that the financial industry was on a few years ago. When fintech startups first started to blossom, many predicted that they would have a disruptive effect on the traditional models of long-standing financial companies. However, quite the opposite happened. Rather than being edged out, many finance companies began to partner with their fintech counterparts to deliver modernized, digital offerings to their customers. The insurance industry now stands to reap the same benefits.  If there ever was a time for insurtech to take the spotlight, it’s now. Traditional carriers have begun to see the immense benefits of adopting a digitized core insurance system and are on the hunt for solutions that can deliver higher efficiency.  At the same time, however, post-pandemic budget cuts might not make big fish solutions the most feasible options. Enter new-age, nimble insurtech players. Smaller insurtech companies a

‘Technology modernization’ is a phrase that has been coveted and dreaded in equal parts by insurance companies in the United States. On the face of it, insurance digital transformation implies moving away from outdated legacy software to agile cloud-based systems. That is never an easy decision to make despite the obvious benefits. Insurance carriers can be apprehensive of embarking on a modernization journey because of certain preconceptions. In this blog, we break down how many of these notions are rooted in digital transformation myths and how carriers can resolve potential challenges on the road to technology transformation.  Myth 1: Technology modernization is time-consuming Migrating to new insurance technology can often be perceived as a complicated, time-consuming process. The common belief is that to successfully achieve technology modernization, companies need to invest at least a few years, over a million dollars, and substantial human resources. This can prove to be too

Over the last year, it's no longer business as usual, and the business world and each of us are adapting fast to evolving global scenarios. One of the biggest changes has been the high pace of digitization across industries and consumer groups. With this shift, however, comes a greater  risk of cyber threats . It’s not surprising then that there has been a huge spike in ransomware attacks, leading to a loss of critical information for businesses and they are turning to insurance to cover them. Insurance companies are still navigating the waters when it comes to cyber underwriting for the new breed of threats.  Cyber underwriting is a whole different ball game for insurers as it is intangible, borderless, and fast-changing. Yet, investing in cyber underwriting can be well worth it for insurance providers as it is estimated to be a $70 billion service within the next 10 years. Currently, only an  estimated 28% of small business owners  have opted for commercial insurance policies.