The word “innovation” has been and probably will continue to be popular in the business world, especially among entrepreneurs. For start-ups and leading businesses, innovation is a must.
Unfortunately, it is not exactly true for traditional industries and markets such as the insurance industry. Insurance companies are much more conservative about digitalization and technological innovations and are reluctant to innovate, although they are aware that this is inevitable if they want to stay relevant in the future.
Largely because of this lack of innovation, overall satisfaction with insurance companies around the globe is pretty low.
The good news is that the top tech trends, remote working, and changing consumer expectations are on their way to positioning the insurance business for disruption. The digital age in which we live and work confronts us with an increasing diversity and complexity of risks and new needs. The old-fashioned, traditional insurance companies are simply not up to satisfying these increasing demands from consumers.
We are already seeing the emergence of some exciting, innovative insurance products that are worth being adopted by the insurance market.
Let’s take a look at 3 of the most exciting innovative insurance products that everybody should consider embracing.
Digital insurance products offer one-stop insurance hubs in your pocket.
You can easily compare offerings from multiple insurance carriers, buy new insurance policies that best suit your needs, store your existing ones, get consultation and assessment regarding their coverage, quality, and price, for example, and – most importantly – submit a claim.
You get all of this instantly, on your mobile phone, personalized for you. It’s much more convenient and much easier than going to the office of a traditional insurance company to take out a policy.
As we can expect, that great value for the users of digital insurance brokers is built on a strong technical foundation, such as AI, machine learning, value chain innovation, and innovation toward the digital-first approach for internal and customer-facing operations.
It seems that the probability of crypto currency insurance becoming the next big thing is quite high. This kind of liability insurance is aimed at protecting against losses imposed by the theft of cryptocurrency held in online wallets, or so-called hot wallets.
In recent years, cryptocurrencies have taken a meaningful place in investment markets, and more and more investors have begun to diversify with the help of cryptocurrencies. However, the goal of diversification is to protect and reduce risk, whereas hot wallets have increasingly become a target of crypto attacks.
As the crypto asset market grows, losses due to cyberattacks and hacks also increase. In order to reduce losses from the theft of cryptocurrencies, some insurance companies have developed a tool to protect against them – crypto currency insurance.
Cyber insurance is a set of new products which emerged to meet market needs that didn’t even exist before the Internet and the digitalization of our society.
Private cyber security insurance
Designed to provide protection to individuals by covering the financial implications of online attacks such as cyber bullying, identity theft, fraudulent instructions, and attacks against the integrity of your home systems.
Business cyber security insurance
Designed to protect small businesses against the same threats as above, with the difference that business implications are sometimes much more complex and expensive. Cyber security insurance usually covers costs imposed by data breach or extortion threat; cybersecurity liability such as lost business revenue and data recovery costs; defence against privacy lawsuits and fines; and money lost due to a fraudulent instruction.
The problems facing the insurance market now
The problems facing the insurance market now are similar to the problems faced by the banking sector a few years ago. Fortunately, the fintech companies and neobanks digitized and disrupted the banking sector, and we all enjoy the positives of this change.
Nowadays, we are witnessing another big transformation, this time related to the insurance sector. More and more insurtech companies are emerging, and thanks to them, the insurance market has started to adapt to meet evolving customer needs.
The benefits of having innovative insurance products
Both insurers and insured benefit from innovative insurance products. They allow insurers to stay ahead of the competition and give more value to their customers. The main benefits for both sides are as follows:
- Diverse and innovative products
- An intuitive and easy way to file and process claims
- Easy interaction between the two parties
- Lower and optimized prices
Delivering an innovative insurance product is not an easy task. But technology is here to help and is already transforming every aspect of the insurance market.
Changing human needs and changes in our environment will lead to more innovation in insurance.
What will be next?