More than any other industry, insurance is forward-looking. Smallwood Insurance is concerned with that future — beyond risk assessments and actuarial tables — because we’re concerned with continually finding better ways to serve our clientele’s Maryland insurance policy needs. Here are some insurance trends we’re watching in the year ahead.
Focus on Technology
If there’s one trend that underpins everything else right now, it’s an increasing nexus between insurance and technology. What’s increasingly known as “insuretech” is being impacted by things like APIs, blockchains, and tech stacks. There’s a startup mentality coming to the insurance sphere, bringing disruption and opportunity in its wake.
Insurance Meets the IoT
The Internet of Things, often abbreviated IoT, is changing insurance in ways we could scarcely have imagined just a few short years ago. It seems like nearly everything with which we interact in our daily lives — our cars, our homes, and our infrastructure — is increasingly “plugged in,” accessible to the internet and increasingly interconnected in interesting ways. That holds promise for insurers and consumers alike, since the data leveraged by the IoT helps us better understand and mitigate risk, making our lives a little safer and our insurance a bit more affordable.
Insurance and Big Data
One of the biggest concerns surrounding insurance, whether you’re a broker, an agent, or a consumer, is cost. The ability to leverage data is directly related to cost, since it allows insurers to identify and address areas of risk; lower risk, in turn, leads to lower prices. That can mean better understanding driving habits, or looking at healthcare trends and outcomes in varying degrees of granularity (from the aggregate all the way down to individuals) to promote not only higher efficiency, but also better behaviors.
Security Comes to the Fore
Data, technology, and the IoT promise enormous gains in efficiency, cost savings, and improved claims processing. However, as recent news reminds us, big data can also bring with it big vulnerabilities. The blockchain, artificial intelligence, human intelligence, and other forms of data security will continue to evolve to meet new challenges in compliance and protection in the year ahead.
Insurance in the Gig Economy
Estimates of worker involvement in the gig economy vary widely. Recode notes that different data sets have arrived at vastly different figures, ranging from 4 to 40 percent of the American workforce. Regardless of the number, two things are crystal clear: the gig economy is growing rapidly, and as it does, new approaches to health insurance, workman’s comp, life insurance, and other traditionally employer-based insurance need to be reimagined to better meet the needs of a changing workforce.
Usage-Based Insurance
Just like employment, the nature of car ownership and use is changing. Many of us are as likely to use a ride-sharing service as to own or lease a car, which means the old model of auto insurance will need to evolve to meet the changing times. Using a complex formula based on ownership, safety, and telematics, auto insurance will soon be much more customizable than it is currently.
Focus on Personalization
In at least one respect, our insurance agency is ahead of the curve. One of the benefits of the developments listed above is the ability to deliver insurance and process claims more quickly, but another is the ability to deliver a higher degree of personalization than ever before. That suits our approach just fine, since we’ve been providing a personal touch to customers in Maryland for some time now. To receive your personal insurance quote for homeowners insurance, auto coverage, or a business owner’s policy, we invite you to contact Smallwood Insurance today.
