This article is part of Carrier Management’s series on the Future of Insurance.
David W. Miles, Co-Founder and Managing Partner, ManchesterStory Group, has his sights on transformed business processes that eliminate cobbled-together workflows internally and reduce friction for customers and claimants as he looks to invest in the industry’s future. IoT datasets further positioning insurers as providers of loss prevention services are also on his radar screen.
Q: What major changes do you see on the horizon for the property/casualty insurance industry in the next 10 years? What will insurance companies, insurance leaders, the industry and its workforce look like in the next decade? What risks will they insure?
Miles (ManchesterStory): Through the years, insurers have pieced together workflows and processes as necessary, typically without a lot of thought given to how other departments, processes or customers may be affected. While this “whatever works” approach does typically achieve short-term results, it affords little insight into how such one-off tasks and workarounds for critical processes may affect long-term goals or effectiveness.
The most impactful changes on the horizon today are those focused on transformation of business practices and which are designed to bring a dramatic reduction in the friction around buying and utilizing insurance coverage—direct digital applications, touchless claims and flexible payment solutions will become ubiquitous, for example. These types of changes not only can provide operational efficiencies and associated financial gains for insurers but also a more streamlined, positive customer experience as well.
P/C insurance will increasingly be bundled at the time of purchase or financial commitment, or be integrated into products as part of the customer solution, leading to new distribution models and partners for carriers.
Distributed ledgers will be used for security and efficiency across multiple insurance applications, including proof of insurance, fraud reduction and claims payments.
The data and algorithms used for underwriting will become much “smarter,” based on a significantly broader set of indicators that provide much greater insight into specific customer risk factors. Falling IoT costs and a growing dataset will position insurers to champion loss prevention and risk mitigation for a much broader customer base under a “prevention as a service” umbrella.
In addition to continued growth in the sale of cyber insurance, falling insurance costs will increase demand for insurance coverage of nearly every kind—though we expect fewer individual standalone policy sales.
Q: How will insurance products and services be distributed?
Miles (ManchesterStory): On the distribution front, technological advances will lead first to digital underwriting and binding, moving over time to insurance as a service bundled into the solution at the time of purchase, and all leading to myriad new distribution channels.
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