A survey of Australian insurance company senior executives conducted by Xceedance revealed seven key factors that will reshape Australia’s insurance industry within the coming decade
An Xceedance survey of senior executives in the Australian insurance industry found seven major trends for the coming decade.
- Changing market dynamics will significantly reduce consumer insurance, especially for motor vehicles. Insurance will increasingly become tied to usage, rental companies, and car manufacturers.
- Digitally native consumers and personnel will expect digital-first, agile processes and interfaces. This will accelerate industry-wide adoption of AI and ML-driven automation.
- Better access to traditional and non-traditional sources of data can help bolster risk evaluation and claims processing and assessment; this will lead to faster Internet of Things (IoT) proliferation to secure real-time data.
- The regulatory environment and industry consolidation will encourage the rise of greater specialization and underwriting agencies.
- The incoming technological revolution will re-engineer existing roles, create new roles, and change the workforce models within insurance companies. New roles will focus on data analysis and interpretation, and workforce models will be a hybrid of onshore and offshore workers.
- Vast amount of data will drive the transition from reactive to predictive risk modeling, focusing on risk avoidance rather than risk mitigation.
- Access to swathes of data, analytics capabilities, and predictive modeling will enable hyper-personalization and help build stronger customer relationships.
Increased collaboration between policymakers and insurance industry incumbents can help identify future risks and create a policy framework that is more conducive to the insurance industry. However, it is also crucial for insurance companies to make strategic technology investments and digitize their processes to prepare well for the future.