In recent years, the insurance industry has experienced significant upheaval from a combination of rising inflation, increasing digitalization, and climate change. Yet, despite these challenges, it is forecasted that the global insurance market will increase by approximately 10% per year. Even though the COVID-19 pandemic is effectively over, it has had irreversible effects on the insurance market. Adding to this, global financial stagnation along with a cost of living crisis in many countries has shifted customer behavior to one that is more price conscious.
Top 5 insurance industry trends to watch in 2024
With ever-changing global trends, it is essential to stay ahead of the curve to ensure your agency will be able to quickly adapt to changing trends. Do you want to stay ahead with insurance trends news? It’s time to take a look at the insurance industry trends that are shaping 2024 and beyond. So buckle up and here we go!
1. Al Technology and Machine Learning are changing insurance business operations
You would probably agree that Artificial Intelligence (AI) and Machine Learning are already impacting all industries. While both AI and Machine Learning are currently maturing rapidly, these tools are already able to analyze massive amounts of data to discover insights much faster than humans and make accurate predictions. These tools have the potential to help the insurance industry streamline operations, improve risk assessments, and underwriting, and provide more personalized service to customers. Implementing cutting-edge technologies can improve decisions based on data and assist in targeting the appropriate customer segments.
One of the most recent AI trends in the insurance industry is chatbots, which assist customers with navigating complex tasks and answering questions 24/7. According to the newest research, 83% of customers are accepting having chat with a chatbot in insurance. Following up on these statistics, it can be stated that the need for chatbots is increasing and it is also able to handle more complex tasks. Additionally, chatbots can be useful in cross-selling and upselling, claim management, or lead generation. Also, it will allow you to see the most frequently asked questions and tailor better offers for new customers!
There's no doubt that AI and Machine Learning have a lot of potential for the insurance industry, but there are some challenges to consider. It requires extensive knowledge and understanding to achieve its full potential. It still provides limited knowledge and resources, but by the end of this decade, it will be fully developed and produce astounding results for the insurance industry!
2. The rise of InsurTech: a new and innovative ways to sell and distribute insurance
InsurTech is the combination of two separate words: “Insurance” and “Technology”. InsurTech leverages the newest technologies such as Al, ML, and big data analytics to improve overall customer experience.
InsurTech is currently shaking up the industry by offering new innovative products and services that make them more affordable for customers. Is it, however, a friend or an enemy of the insurance industry? On the one hand, InsurTech may pose a threat to insurance by providing customers with more affordable and personalized products than traditional insurance products. To flip InsurTech around, you can use this opportunity to collaborate and stay competitive by incorporating new technologies into your business operations.
InsurTech assists customers in streamlining their purchasing process, comparing policies from various insurance companies, and providing all necessary information during the purchase process. It provides better value to customers through on-demand insurance, which is designed for short-term insurance needs such as travel, car rentals, and events. It can also use telematics to collect data about tangible assets such as houses, cars, or buildings, allowing it to provide better deals to customers.
Overall, the insurance industry is complex and can present challenges to customers; however, leveraging InsurTech can make the insurance purchasing process more convenient and easier!
3. Personalized insurance is in demand
In today’s market, customers are demanding an increasingly personalized service. According to the newest research, in the insurance industry, customized services boost customers' retention rates by 81%. This indicates that rather than simply offering the same general insurance packages, customers are increasingly expecting a tailored offering... Remember - each customer will have unique needs, which means you have to suggest a particular plan and price.
Personalization goes beyond sending customers generic emails or text messages. It is about proper onboarding and consistent follow-ups so that your customer gets all the necessary information and receives the maximum value.
Paying close attention to your customers will deliver long-term benefits. Providing a good service will only increase the likelihood of your customers renewing and buying further policies, in turn, increasing your profits.
4. Being sustainable will give you a competitive advantage
The growing customer awareness of environmental, social, and governance (ESG) issues is placing increased pressure on insurance companies to be more sustainable in their practices.
As customers are becoming more conscious of how their purchases affect society and the environment. As a result, they are increasingly demanding more environmentally friendly, ethical and socially beneficial products. For example, let’s take the issue of climate change. Evidence points to climate change increasing the risk of causing everything from disease to natural disasters exposure as a result leading to increased insurance claims. By including this in their risk assessment, insurance companies can better evaluate their offers and avoid losses.
Green insurance is expected to maintain its leading position in the insurance industry through 2024. This type of insurance is designed to support and promote sustainable activities and practices for customers.
5. Data-driven insurance continues to have an impact
As data becomes more important, it will continue to drive the future of insurance. Insurers can gain a better understanding of their customers' needs thanks to the rise of insurance data analytics. Insurers can better assess and identify potential risks with their customers by using data analytics. Furthermore, data-driven insurance can be integrated into embedded insurance, allowing customers to receive more personalized and targeted insurance products.
Data analytics are also critical in fraud detection. Data analytics are being used by insurers to detect suspicious activity and fraudulent claims. This will help both insurers and their customers avoid costly losses.
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Make data-driven decisions with Plecto!
In 2024, the insurance industry will be shaped by various trends, which will continue in the upcoming years. Making data-driven decisions is crucial for the success of insurance agencies today. Stay on track by integrating all your insurance CRM data into Plecto's real-time dashboards. You will be able to centralize all the necessary data in one place and empower your team to make data-driven decisions that will skyrocket your sales!
With Plecto, you can get scheduled reports with custom KPIs, which will significantly reduce your manual work on reporting and let you focus on other important tasks!
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