No going back The virus lockdown has forced the insurance industry to discard its go-slow tech approach By Bernice Han
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t’s finally happening. Technology is being embraced at unprecedented speed in an industry that has, fairly or unfairly, earned a reputation for its slow and cautious approach to the digital revolution. Before the pandemic arrived nothing, it seemed, could nudge the industry into going faster in adopting new technologically-based ways of doing things. Massive amounts of money may have been poured in recent years into mobile apps, drone research, artificial intelligence, bots, cloud solutions and insurtechs, but application-wise the industry is still perceived as behind the banks and other financial services providers. The new technologies that insurance has invested in are either still in various stages of pilot development, or if used commercially they are usually being implemented on a limited scale. But the pandemic has changed all that, pushing the industry out of its comfort zone. The sudden shift overnight to all things virtual and remote may well be irreversible, according to KPMG. “Coming out of the crisis, the sector could look fundamentally different: much more agile, secure, connected and digitally enabled,” the consultancy says. “Perhaps, indeed, COVID-19 was the digital wake-up call the industry needed. Now the opportunity is there for those
who can to gain value from it for their organisation. “Just as COVID-19 has forced insurers to adopt remote and digital ways of working, so it is undoubtedly set to drive a wider acceleration of technology adoption across the industry. This is a trend, of course, that has already been with us for some years, but the current situation will significantly expedite it.” As the industry starts turning its thoughts to what the post-pandemic landscape might look like, KPMG predicts there will be an increased focus on using technologies to improve pricing, underwriting, claims handling, policyholder interaction and fraud management. Scott Guse, KPMG’s Brisbane-based Partner for Audit, Assurance and Risk Consulting, expects the industry to raise its focus on chatbots. With local and offshore call centres affected to varying degrees by the pandemic, customers have had to refer their enquiries to online chatbots, but the results haven’t been all that satisfactory. “At the moment, the chatbots are not as sophisticated as they need to be,” Mr Guse told Insurance News. “When they are too generic, they actually annoy the customers when their problems can’t be solved. “Insurance companies have realised they need to enhance the ability of those chatbots to be more
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