The ”emerging technology” label covers everything from predictive analytics to chatbots to smart home automation. But while these tools can enable valuable capabilities, many carriers are still focused on the wrong question. Rather than trying to identify what these technologies can do for their organization, insurers should be determining what problems already exist in their organization—and then seeing what technology provides the appropriate solution. Beginning with a business need in mind can ensure that carriers are only launching initiatives that yield results. To do this effectively, insurers should follow Novarica’s Three Levers of Value in Insurance: sell more, manage risk better, and cost less to operate.
Few emerging technologies (with the exception of predictive analytics and mobile) are widely used by insurers today. However, insurers may want to look to early adopters—many of which have already reported positive ROIs in analytics, RPA, and drones. Though rates of pilot activity, deployment, and investment have remained steady from 2018, sensors and telematics show strong growth potential, while big data and AI continue to see high levels of pilot activity in chatbots.
New tools and technologies can go a long way in enabling insurer capabilities, but adoption should always be done with care. Insurers looking to deploy new technologies should consider how new tools can help them achieve their current business and IT goals. Starting out with a clear vision—a clear need—can help insurers avoid technology-led business cases resulting in lack of business interest, operationalization of new capabilities, and return on investment.
For more on this, see Novarica’s recent Research Council Study, Emerging Technology in Insurance: AI, Big Data, Chatbots, IoT, RPA, and More. The report is based on surveys and interviews with 104 insurer CIO members of the Novarica Research Council. It is designed to help insurers track planned pilot activity, adoption rates, comparative deployment rates, and use cases across various new technology areas.
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