New research has revealed that insurance firms are increasingly looking to discover the latest technology to help them carry out their operations more effectively.
Research from the US has found that insurance firms are actively seeking ways to improve their offerings and develop greater technological developments so that they are able to provide consumers with a better range of offerings and lower insurance policies. The trend discovered by technology solutions provider, Fiserv, is likely to be followed by insurance companies in the UK as they look to ensure consumers are being offered the best value for money, while business processes are improved to keep costs to a minimum.
Todd Eyler, chief technology officer of Fiserv Insurance said that the results demonstrated a growing focus on "effectiveness as well as efficiency". He added: "The most important technology focus is now on data accessibility so companies offer the best insurance products for their markets and make better decisions using business intelligence/analytics applications."
Mr Eyler explained that there is now a renewed focus among insurance companies on data and analytics, meaning that they are increasingly relying on sophisticated technology to help them. As a result, many of the top firms are seeking to stay ahead of the game by being the first to test out new and innovative technology that can help them to lower the cost of premiums for customers. This competition is likely to benefit the market in the UK, as more insurance firms will be able to learn from the US industry's technological advances and take on board some of the ideas that have delivered positive results.
One area in which British insurers may feel the need to improve their offerings is in developing new and innovative approaches to the way they insure homes that are at risk of flooding. As the recent floods have shown, the issue of flooding is becoming an increasingly prevalent problem in the UK and as climate change begins to take a grip around the world, there is a concern that current methods will not be sufficient and many buildings and homes will simply become uninsurable against flood damage.
As a result new and innovative practices in the way insurance is calculated, using a wide range of technological advances, are required to ensure that insurance against flood damage remains a viable option. By using the various data that is now available, insurance companies will be able to deliver a number of new solutions.
Such an approach is already emerging in the car insurance sector, where technology is being used to deliver 'pay-as-you-drive' solutions. This method has arrived as a way to allow young drivers to still obtain car insurance. There have recently been warnings that young drivers could soon become uninsurable because of the number of accidents in which they are involved, but the pay-as-you-drive scheme is thought to be able to get round this by providing cheaper insurance to drivers who agree not to use their vehicles at night, for example.