A few decades ago, it wasn’t common for insurance and technology to go hand-in-hand. Today, however, the former relies heavily on the latter due to modern methods of working. Fortunately, complex workflows and massive paperwork have conveniently been demystified by this digital transformation. Fast forward to 2021, and CentricDigital reports that the insurance industry's tech trends have reduced cost by 65%. What are some of these digital trends? Here are a few of them: 

AI & Automation for Faster Claims

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Robotic Process Automation (RPA) and Artificial Intelligence (AI) have taken center stage in the insurance industry. These systems are operated by AI algorithm advancements, enhanced data processing, and innovative data platforms/channels, making it one of the most impactful tech tools in the insurance industry. Due to RPA, there has been a drastic reduction in the once cumbersome paperwork trail.

As stated by Hanover search, the insurance industry's commitment to RPA has contributed to minimizing fraud, reducing long claim processing times and the inherent costs involved. Regarding fraud elimination, RPA makes it possible for accurate underwriting, which has helped detect risks and scams quicker. Consequently, it has also boosted higher profitability in the insurance sector.

How did the RPA come about? First of all, it's worth knowing that it’s a mix of several technologies working together but for varied automation processes. Although the initial development of the RPA began in the 1990s, it wasn’t until the early 2000s that it became popular. According to tech history books, RPA was developed on three key predecessors:

• Screen scraping: Technology for extracting data from documents, the web, or programs

• Artificial intelligence: Computers, machines, or robots developed to mimic human intelligence.

• Workflow automation and management tools: These automated actions reduce human tasks.

Blockchain

This technology aids the design of a digital ledger to reduce admin costs that usually accompany claims reviews. Because this digital ledger can’t be altered, insurance companies can check third-party payments without hustle. Blockchain is an information-sharing platform, verifiable, and designed to protect against fraudulent activities. No one can duplicate this virtual ledger and, for that reason, boosts transparency and better workflow. Again, with the Blockchain, you can solve business issues before they even crop up.

In a recent report by PricewaterhouseCoopers, the group reported that Blockchain is primarily of benefit to reinsurers. The reason being the technology reduces cumbersome processes and repetitive procedures. More so, PWC forecasted that this technology alone could save the world a sum of 5 – 10 billion US Dollars.

InsurTech Partnerships

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These are strategic tech partnerships making it possible for traditional insurers to use digital platforms effectively. Furthermore, these partnerships offer quicker results, which is beneficial to traditional insurers. InsurTech offers technology capabilities that fuel the demand that millennials make for new products and services. In exchange for this offer, InsurTech companies can access a bigger customer base. Additionally, they’re compelled to create or design newer models to give rise to higher profits.

The world is continually changing, and so is the way of doing business. Moreover, a rapidly advancing technological world is fueling this change. Today, insurance processes aren’t the way they used to be, with evident transformation such as cost reduction and efficiency changing the industry’s dynamics.