Blockchain, smart contracts, mobile apps: what to use for Insurance Tech in the coming years?
The insurance is one of the oldest spheres of financial services. In today’s world, when everything is becoming digital, this industry also doesn’t stand aside. Being a perspective business domain, now Insurance Tech attracts a lot of investments.
Only imagine, at the moment the global volume of insurance services varies from 4 to 6 trillion dollars per year, while one of the investments in Insurance Tech reached 2.65 billion dollars in 2015. And this number continues to grow.
In this post, we will speak about digital insurance trends and get an insight into tech solutions, including Blockchain integration, smart contracts, custom mobile and web app development, Big Data and on-demand insurance. So, let’s start.
1. Blockchain integration & Smart contracts
Blockchain is the number one among digital insurance trends. This technology is promising to innovate a variety of industries, and a digital insurance is not the exception. Today Blockchain is used not only in banking and finance as many think, but in healthcare, voting, supply chain management, and others. Learn more about Blockchain technology integration in our recent post.
There are two main cases for Blockchain usage in Insurance Tech, where the first is a distributed ledger. Imagine, for example, a P2P insurance project: users create and join groups that themselves develop insurance products, provide services and set up rules, as well as take decisions with the help of voting or by applying to insurance agents that can also be participants in a group.
The second Blockchain usage example is smart contracts, the self-executing self-enforcing contracts with the terms of agreement between two sides that are written into programming code. Both the code and the agreements exist in Blockchain, a decentralised network.
So, there is no need for central authority, a legal system, and contract intermediaries, so smart contracts perfectly suit for cases of mistrust between the disparate and anonymous parties. Smart contracts allow saving operation costs and transaction transparency and security.
As an example of smart contracts in a digital insurance we can mention a project against flights delays or cancellation. Using publicly available data of independent providers, payments occurs automatically when the customer makes a request.
2. Custom mobile and web app development
There various digital insurance trends, custom mobile and web app development is one of them. Depending on the business needs, mobile and web apps can solve a wide range of problems, helping automate different processes and improving customer experience. The emergence of a digital insurance built a new model of adding real value to customers.
Let’s take, for example, insurance policies. They can be complex, so their holders often don’t understand some fees and coverages, and purchase them on unfavorable terms. Next, sometimes underwriting and closing a policy is rather a time-consuming process which may take up to several weeks. Here mobile and web solutions can help simplify various operations and enhance customer service.
Imagine a web app that will enable you to automatically track all and quickly process all requests (emails, calls), keep records in the database (CRM module), direct customers to appropriate specialists, track an insurance policy status and inform about its upcoming ending.
Another example is an application allowing customers to find the best insurance policy (taking into account their needs and requirements), compare prices and providing the ability to instantly contact an insurance company and purchasing the policy via a smartphone.
Also, you can build a mobile solution that would enable insurance agents to enhance customer experience and improve their digital journey, and app users – to send claims and purchase services within it, simplifying and automating claims and reducing operation expenses.
Thus, custom web and mobile app development can can help reduce expenses, accelerate workflow and improve services quality.
3. On-demand insurance
Why do you have to buy an annual accident insurance policy, if you are an office employee and only sometimes allow yourself to practice extreme sports? Why do you need to pay for car insurance for the whole year, if you use it one time a week?
There are a plenty of similar examples. Many companies understand possible benefits they can get from implementing the solution for these problems. First of all, it is reduced costs, improved customer satisfaction, new clients and increased loyalty.
What’s more, in today’s competitive world companies have to constantly maintain their performance and form a customer-centric approach. In the century of technology, it’s important to provide clients with the ability to make operations via their smartphones and “switch” insurance only when it’s needed.
Here we’re speaking about on-demand insurance. It’s rather a new direction, which is quickly developing and can touch a number of industries and life spheres. Imagine, for example, a mobile application for on-demand drone insurance, that would work as follow: a user selects a flight area for his drone, purchase an aviation insurance policy, monitor policies with a timer and app notifications.
Another case is the coverage of individual expensive things like vehicles, musical instruments, laptops, tablets, cameras, sports equipment, and much more. So, you can create a mobile app for gathering information about the items, comparing prices and choosing the best variant, informing about damages and losses.
Hence, here custom mobile app development can be used for building different solutions depending on project business needs and objectives.
4. Big Data
Big Data analysis tools play an important role in many industries. Big Data solutions allow to capture, collect, store and process both structured and unstructured data transforming them into valuable information.
By gathering customer information from a number of sources (mobile apps, social media channels, etc.) an insurance company get the ability to create a detailed profile of each client, estimate lifetime value, make predictive analysis, and more.
Thus, there are various digital insurance trends, that involve Blockchain usage cases in the industry and an increasing interest to this technology, emergence of smart contracts, application development, Big Data and solutions for on-demand insurance as well.