7 Ways Fintech is Helping the Insurance Industry

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People are living in a tech-savvy world. According to data from the Pew Research Center, 93 percent of adults in the United States use the internet. Thanks to technology, individuals can perform transactions anytime, anywhere with just a few simple clicks of a mouse or a few taps on their mobile phone.

Consumer expectations and behavior are also evolving, and so is the manner of accessing and assessing products and services. This has influenced the insurance industry. You can say that technology is reshaping the way people select insurance products today.

Due to the rapidly changing situation along with the aggressive consumer demand, many insurers are teaming up with financial technology (fintech) firms to offer insurance products (or deliver customer service) to consumers who prefer to transact using their computers, mobile phones and other internet-connected devices.

Such partnerships come with the following customer benefits:

  1. Convenience in Choosing the Right Insurance Product

Customers today only need to input their requirements at an insurance marketplace website and determine their eligibility criteria to obtain instant offers to compare life, health and general insurance providers and thereafter purchase the products online. Thanks to technology, consumers can enjoy customized, real-time offers on one screen. This will help customers make the best selection for their needs.

  1. Reduced Insurance Costs for Consumers

Online customers getting an insurance product, such as life insurance and investment plan, can enjoy lower insurance costs. The online nature of the insurance marketplace does away with the need of hiring salaried branch insurance sales representatives and renting an insurance office. This benefit gets passed on to the consumers in the form of lower processing costs and premiums.

  1. Accelerated Claims Settlements

Insurance firms can collaborate with FinTech firms to identify damages more quickly to help with claims settlements.

Here’s an example: car insurance companies can use telematics devices to help locate accidents and assess their impact and severity. The right telematics technology can pinpoint a vehicular accident when it occurs and deploy in-network tow trucks and emergency services instantly to the location of the incident. Claims processors can use this data to estimate the damage amount and process claims faster and more accurately, benefiting customers in the end.

Insurers can also collaborate with various tech firms to deliver IoT-embedded security devices, such as theft detection systems, doorbells with video recording capabilities and smoke alarms. These technological products can potentially accelerate the claims process by evaluating the damage remotely.

  1. Greater Reach

An online marketplace that sees millions of visitors per month offers enormous visibility – something that insurance companies would be hard-pressed to replicate.

Besides that, the proliferation of mobile internet is growing quickly in both rural and urban locations. This opens up a whole new geography for insurance providers to target prospective consumers without having to rely on brick-and-mortar setups.

  1. Paperless Transactions

E-signatures, e-stamping and e-policies are gaining traction. There will come a time when people will buy an insurance product instantly with no physical paper exchange.

What’s more, the uploading of documents along with the automation of claims processing will help insurance policyholders process claims quicker. An online platform that enables insurance companies to conduct paperless transactions and do everything digitally can make life a lot simpler for both the insurer and the policyholder.

  1. Personalized Approach to Customer Service

The right technology can allow insurance companies to be more direct when serving their customers. Insurers, for instance, can tailor their service delivery to a more personal level to bump up customer satisfaction.

This approach, however, is just the tip of the iceberg for insurers, as these companies are still exploring and studying the area of personalized insurance solutions and their effect on the market as a whole.

On the other hand, customers can integrate their personal data with the insurance firms they’ve chosen to work with to receive service more easily and in a streamlined manner. This is better than jumping through multiple bureaucratic hoops. The advantage of this is significant, as customers are more willing to share their data when it matters.

  1. Simplified Insurance Products

The online world can motivate insurers to come up with simple, targeted and easy-to-understand products. They can accomplish this by partnering with a FinTech company that offers a platform that helps insurers offer these products to the right target market.

Simplified insurance policies can benefit both the insurer and the insured. These policies come with reduced loaded costs and commissions. What’s more, they are ideal for first-time insurance buyers and customers looking for systematic savings.

Insurance companies should not stick to the old ways of doing business and collaborate with fintech firms by working together cohesively as a single unit. By doing this, insurers can offer great products and deliver exceptional services to their consumers.

Vinh Van Lam
the authorVinh Van Lam
Vinh Van Lam, co-founder of ArtSHINE, is a visionary art coach and entrepreneur with a passion for fostering creativity. With a diverse background in art and business, he brings a unique perspective to empower emerging artists, enabling them to thrive in the dynamic art industry through the innovative platform of ArtSHINE.

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