Future of Insurance

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by Rob Galbraith, bestselling author and innovation leader

Industry View from

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The rise of insurtech is bringing about the end of insurance as we know it

A powerful combination of millennials, venture capital and emerging technologies are changing the art of the possible in insurance.


It may not be top of mind as we go about our daily lives, but we inarguably live in a world of accelerating change. New technologies such as cheap sensors which connect to the internet (aka the internet of things, or IoT for short), artificial intelligence, blockchain and its cousin distributed ledger technology, natural language processing (NLP), robotic process automation (RPA) and a host of others have become popular. These rapid technological developments have been enabled by the miniaturisation of chips, mobile devices and cloud computing and are used in a host of new and powerful yet intuitive applications. To cite one example, consider that the rapid adoption of global positioning satellite (GPS) technology in smartphones over the past decade has virtually replaced the need for paper maps – previously a centuries-old technology widely relied on for navigation.


The tradition-bound world of insurance is not immune from these forces. Insurance has a rich history and powerful longevity as an industry because of the societal good it provides. Insurance enables consumers to drive a car, buy a home and start a business – people buy insurance because they need to (and are often required to) in order to do something they really want to do.


Contrary to the perception of many, the insurance industry has historically been an early adopter of technology. Insurance companies first and foremost run on data and algorithms, and large mainframe computers were perfect for batch-processing policy issuance, renewals, billing and claims handling. However, this legacy technology makes it challenging for insurance agents, brokers and carriers to move quickly in the 21st century. Just as continued spending on a credit card without fully paying off the balance each month can lead to an unsustainable debt load over time, the failure to fully modernise systems and infrastructure over the past three to four decades has led to a buildup of “technical debt” that has now come due for much of the insurance industry.

Image provided by Rob Galbraith

If you were to design the perfect industry for our modern times, you could do worse than insurance. Largely based on data, insurance does not require large investments in physical capital or global supply chains subject to disruption from unexpected events such as the coronavirus. So it might be tempting to assume that insurance consumers should be benefitting greatly from information technology in a sector built upon data.


But as anyone that has gone through the process of purchasing and insurance and filing a claim, it can be a frustrating experience. Insurance is complex: it is a blend of product and service, both a financial instrument and a legal contract that is highly regulated and enforced by the rule of law. There are many long-standing and well-known problems in insurance that have yet to be adequately solved – until now.


The rise of these new technologies and focused innovation in the insurance industry has led to the rise of “insurtech”. New start-ups and value propositions, fueled by an era of cheap capital, are created daily to address the “fatal flaws” of insurance. Insurance is too expensive and complicated; fraudsters constantly seek to game the system; it is a drain on liquidity for consumers who live paycheck to paycheck; it doesn’t cover all causes of loss or everything or everyone in society who needs it. While the industry press is abuzz with daily headlines announcing new breakthroughs and partnerships between traditional entities and insurtech startups, the reality is more complicated – and with so many moving pieces today, the industry is shifting rapidly.  


Now more than ever, it is vital to bring together entrepreneurs, technologists and other insurance newcomers with industry veterans to provide a common framework of understanding how we can build the future of insurance together. By doing so, leaders will foster collaboration that spurs new innovation to bring insurance fully into the 21st century as an essential digital product that meets the evolving needs of today’s consumers around the globe. The bestselling book The End Of Insurance As We Know It has sold thousands of copies around the globe and received top reviews from readers across the spectrum, from insurance professionals to those coming to the industry with fresh eyes. In bridging the gap between old and new, the book signals not only the end of insurance as we know it but heralds the future of insurance as it should be.

To find out more, please visit here for the UK version and here for the US version.

Please also see the companion website for the book here.

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