The always-evolving insurance industry will see changes in 2024 as the focus shifts to customer value and hyper-personalization.
If 2023 was the year of AI, what will 2024 bring for the risk and insurance industry? Some things are certain, like the continued focus on finding ways to help people and communities through insurance and risk management. Certainly, the many use cases, benefits, and implications of AI will continue to be explored in various ways while other innovative trends will rise in popularity alongside it this year.
Here are our top four predictions for the risk and insurance industry in 2024.
1. Hyper-personalization Changes the Customer Journey
Historically the insurance industry has been built on personal relationships, and although automation will continue to be significant throughout the insurance lifecycle, the people side of the business remains important.
Hyper-personalization will gain more momentum as companies invest in ways to connect organically with their customers and potential customers. The ability to connect with people on an individual level throughout the insurance lifecycle, from policy inception and administration to claims management and billing, is only going to be more important as insurance continues to be viewed as a commodity.
This trend means knowing your customer well, predicting their needs and wants, and exceeding expectations. Insurance follows an individual or business through its lifetime, meeting needs and making goals happen along the way. The best customer journey is one where needs are anticipated and met proactively.
2. Quick Wins Prevail Over Long Implementation Cycles
Finding and implementing solutions that generate quick wins will continue to be a priority. The first iterations of insurtechs often meant long implementation cycles — with the high costs associated with them. These solutions were often monolithic and did not always allow for easy partnerships with other vendors.
The landscape has shifted to an environment where insurers and insurtechs are finding success by working together to find times when a solution can be quickly implemented and deployed. These quick wins motivate employees to keep working together and finding more ways to innovate. A fast implementation cycle can drive success forward as quick wins build momentum and create lasting improvements.
3. Partnerships Between Insurtechs Create Momentum
One lesson learned in 2023 was that no one insurtech can be the sole solution provider for the industry. Insurers and insurtechs began partnering in new ways with insurtechs working together to build solutions that filled in the gaps between providers. These partnerships meant insurers — and ultimately policyholders — benefited from the unique combination of innovative solutions that could improve efficiency, lower costs, and reduce cycle time.
The power of multiple insurtechs partnering together magnifies the results an insurer can see. For example, an insurer may need a claims management platform but would benefit from integrating payments, communications, and fraud detection into the platform. By partnering together, insurtechs can seamlessly offer these integrated solutions that insurers need, offering more value than a single solution could.
4. Extreme Focus on Customer Value
The customer will continue to be at the center of the insurance lifecycle. While this isn’t new, the insatiable drive of many insurers and insurtechs to put the customer first will become a top priority. This can be accomplished partly through the hyper-personalization strategies discussed earlier.
Other ways insurers can leverage new technology to narrow their focus to customer value include:
- Using generative AI to supplement the claims-handling process
- Augmenting existing data with better analytics to offer personalized risk management services and products
- Adopting digital platforms to streamline customer interactions and simplify policy, billing, and claims administration
- Educating policyholders about policies, products, coverages, and risk management solutions through AI to increase awareness of value and options
- Deploying augmented reality solutions like virtual appraisal options so policyholders can use their mobile devices to manage their claims and submit images or measurements
Being customer-focused makes sense for an insurance company. Putting the customer at the center of every interaction can lead to higher retention rates and provide a competitive advantage for the company that does it well. Insurtech innovations designed to help insurers focus on increasing customer value can help achieve this goal.
Innovations Continue in 2024
The insurance industry is always innovating, and while the future is uncertain, we can expect to see continued growth and momentum toward progress. To drive success this year, insurers can focus on the customer through hyper-personalization, find value through quick wins, and enter smart partnerships to fill gaps and enhance technology.
Reach out to WaterStreet today for your free demo to learn how our cloud insurance services can help you do more. With our claims, policy, and billing platforms you can manage the insurance cycle from end to end while our insured portal and API toolkit connect seamlessly with policyholders and partners.
About the Author
Abi Potter Clough, MBA, CPCU, is a thought leader, consultant, and keynote speaker. She writes about change, insurance, risk, and leadership for Risk & Insurance magazine, CLM, and several top insurtechs, carriers, and brokers. Her prior career was in claims operations for a major US carrier. Abi is the founder and CEO of AbiLeads, LLC, and the author of Life After Leaping In and Top 10 Lists for Relocation. Connect with her on LinkedIn or at Abi1Leads@gmail.com.
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