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What does the future hold for insurance?

What does the future hold for insurance? | Insurance Business UK

What does the future hold for insurance?

The theme of the Chartered Insurance Institute’s stand at BIBA this year was ‘Future Proofing your Business’. Technological advances are prevalent across all industries, and it seems that by the time we have caught up with the most recent development, the next big change is rounding the corner, and the process of adapting starts all over again. Broking is not immune to these challenges.

Recent technological advances are creating change in the sector, and proactive professionals need to be ready and willing to embrace this and adapt accordingly. A recent survey conducted by the Society of Insurance Broking (SIB) revealed that 74% of brokers are investing in the most recent technology in order to stay ahead of the market and remain competitive. This is reassuring not only in terms of customer service but also in relation to automating repetitive tasks which can discourage talented staff from reaching their full potential in our profession. However, another interesting statistic returned by the SIB showed that an even higher 79% agreed that new technologies and automation actually make the purpose of personal relationships and human interaction more important in the broking process. This is an interesting reflection as it shows that while artificial intelligence (AI) may facilitate efficiencies, insurance is ultimately about trust and relationships, a feature of undertaking business which has not changed since its inception in the coffee houses of London.

What this shows is that people will not be easily replaced during the broking process, but the focus of those people may change. As AI enhances routine decision making, lowers costs, and optimises customer journeys, people will become more important for the customer centric elements such as creating more bespoke packages which meet a client’s individual and unique needs. This could have the further benefit of reshaping how the profession approaches underwriting and pricing, potentially increasing access to insurance for people who have previously found it difficult to afford or obtain through a solely automated process.

Of course, AI isn’t the only technological advance which is changing the profession. Nowadays, we are carrying computers around in our pockets, speaking to them in our homes and even wearing them on our bodies. These computers are continually gathering data about us and how we live our lives, even down to how many steps we take each day which has implications around our fitness levels, which may impact the cost of our health and life insurance policies.

Consumers today have more complex needs and more choices than ever before, and furthermore are much more knowledgeable about their various options. For the profession, this means that competition is high, and a readiness to offer highly tailored solutions is key to delivering successful client outcomes. However, this isn’t a race to the bottom in terms of price - the challenge here is about how much brokers are able to engage with a better educated public, how much time they are willing to put into understanding a client’s specific case, and, therefore, how accurately they are able to address the needs of those clients.  

While the general concern is that the robots are coming to take our jobs, I think in reality our jobs are simply going to change. Brokers stand to truly thrive by being proactive in adopting technology, and by keeping at their core an understanding that the insurance profession is about protecting people.