This is according to James Harrison, UKI Head of Insurance at data and analytics provider Dun & Bradstreet, who says that the onus will be on re/insurers in the post-COVID world to demonstrate their value.
Harrison believes the COVID-19 pandemic has been a “catalyst for long-awaited change” in the re/insurance industry.
Organisations across every sector are now looking to insurance firms to provide solutions to remedy the financial impact of the pandemic, with many demanding that coverage be packaged in with traditional business interruption policies.
In response to the crisis, Harrison predicts there will be an uptick in parametric products next year, which promise a quicker, more transparent claims process than the traditional business interruption policies that have caused so many difficulties this year.
Additionally, re/insurers may find it necessary to take on more of a business advisory role, promoting proactive measures and behavioural changes to help organisations prevent losses.
This trend can already be seen within cybersecurity, Harrison notes, where firms advise clients on preventative measures to avoid a breach in the first instance and then, where needed, respond to the individual incidents.
If re/insurers hope to improve their value proposition and attract new customers, insights from enhanced data analytics are also going to become a growing priority.
“Data is central to the running of any successful insurance firm,” Harrison said. “From helping the firm to better understand their customer, to understand their individual products and services, and even risk assessment and analysing the full extent of a claim, it all comes down to data.
“By using data and technology in a more structured and effective way, insurers themselves can better adapt to changing regulatory requirements and customer demand,” he added. “And the ability to adapt is going to separate the successes from the failures in the next few months.”
Alongside this focus on data, 2021 will likely see increasing investments in digital and data technology across the re/insurance industry as businesses look to remove significant cost and reduce time-consuming manual work.
“In a traditionally slow-moving sector, where participants rely on each other in the value chain, the onus is on the whole industry to embrace technology and move forward as one,” Harrison asserted.
Other opportunities after COVID could centre around product innovation in new markets such as gig workers, Dun & Bradstreet believes.
And with more people working from home, there could be increasing demand from remote workers, self-employed people and entrepreneurs for insurance products that address the risks of their new working environments.
Source: Reinsurance News
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