Sydney FST Media Future of Insurance conference foreshadows wider uptake of big data, analytics, digital and mobile platforms. 

The success of Australia’s insurance sector will be led by a more astute use of technology, including big data, digital and mobile apps. During keynote presentations at the Annual FST Media Future of Insurance conference in Sydney, industry experts noted that future success lies in strengthening relationships with clients. 

These relationships are enhanced by a more astute use of big data, digital services, and connecting with customers in their personal and mobile space.

Preparing for the unknown

For insurance, the roadmap is about calculating the risk and preparing for the unknown. A new generation is replacing the baby-boomers, and this comes with a different take on technology. In future, the millennials or generation Y will have more purchasing power, while replacing the baby boomers. But this younger demographic remains apathetic about finances and insurance, and is best reached through the more intuitive technologies.

This group needs to be targeted differently and insurers can leverage the data more effectively. This segment is also more interested in the conscionable and ethical companies, with a footprint spanning corporate goverance and transparency.

Implications for longevity

Current longevity trends show that millennials will live a lot longer. This longevity impacts on insurance, lifestyle choices, and expectations around social services or healthcare. There are also ongoing government and regulatory changes involving taxes or pension schemes. These clients need more targeted advice. The industry also needs to make better use of behavioural economics to see how people make decisions and tailor their services.

The necessary items for people incorporate super, bank account and insurance needs. While these are necessary; these items may not be “necessarily engaging,” one speaker observed. The industry needs to send and share information in different and more engaging ways.

The more interactive technologies incorporate gamification, social media, and integration between digital and mobile channels. “The power is shifting into our pockets, using mobile devices.” 

On the flip side, not all interaction is digital. “Generation Y still needs a voice on the phone or the personal contact. In other words, interaction with a warm body.”

For insurance stakeholders, the goal is to leverage the power of data analytics, build broader eco-systems, while remaining socially connected and autonomous.

Outlook for IoT

According to Sanjeev Gupta, CIO, HCF Australia, the uptake of the internet of things (IoT) requires a more sensible use of data. “That is the challenge,” he noted during a panel discussion. “This is also about how we manage data from a privacy perspective.”

Among the trends, peer to peer insurance is surfacing in Europe. Australian companies need to track the value of policy-holders pooling their insurance, added Gupta. 

The peer to peer model enables insurance policyholders to form small online groups, while helping defray the cost of individual insurance.

Andrew Hopkins, the head of strategy and architecture, QBE Insurance, said the focus is to enhance the customer digital experience. The onus is to personalise the customer experience, while managing the elements around digital privacy.

“Banks are facing digital disruption, and insurance needs to follow,” Hopkins said.

Increasingly, insurers are investing in digital platforms to build their relationships with customers across all product classifications and geographies. 

This sector seeks to empower businesses and consumers to shop more cost-effectively for insurance. The focus is to make products more transparent, easier-to-understand and compare with a range of offerings.

In Australia and Asia Pacific, insurers can capitalise on data analytics, cloud computing and modelling techniques.These technology tools help sharpen market segmentation strategies, minimise the potential of claims involving fraud and strengthen the underwriting and risk management programs.