Transformation of Risk Management in the Insurance Industry

Transformation of Risk Management in the Insurance Industry

The insurance industry is characterised by highly manual processes such as claims processing, insurance underwriting, policy administration, and customer service. Many industry players still follow conventional and obsolete inspection methods.

As per a study by McKinsey, due to the implementation of emerging technologies, 25% of insurance companies will be automated by 2025.

Some of the negative impacts technology stagnation has on this industry are:

  • Non-compliance with industry standards
  • Unable to cope with market demand
  • Susceptibility to being overtaken by their more aggressive competitors
  • Adverse and skewed risk selection
  • Exclusion from list of preferred distribution partners
  • Inefficient recruitment and retention of skilled and experienced professionals

That is truly a wake-up call for insurance companies to understand the technological trends and the competitive landscape to begin their digital transformation. The insurance industry needs to adapt to the shifting market conditions and developments to multiple value creation through modernisation.

Technologies Aiding Risk Management

For companies to reinvent and streamline their processes, they need to understand emerging technologies and tools. Today, technology-backed enterprise risk management tools help increase operational efficiency and provide a better customer experience.

Let’s see how:

Applied Artificial Intelligence in the Insurance Industry

The insurance industry has particularly taken notice that the adoption of AI-driven systems and technologies will help bring about overall process efficiency.

Its advantages include:

  • Increases productivity
  • Automates claim processing
  • Provides accuracy to risk surveillance
  • Increased fraud prevention
VRS Claims Handling

The Economist Intelligence Unit states that 86% of banking and insurance institutions intend to invest in AI-related technologies by 2025. Insurtech companies can help minimise manual gathering of data and even help identify and eliminate fraud via real-time enhanced checks and scientific risk scoring.

Streamlined Risk Assessment with High-tech

Transformation of Risk Management in the Insurance Industry

Technological advancement in risk assessment helps make data transfer and processing more speedy, accurate, and efficient. With in-built technology, one can help provide a steady stream of data regarding claim status, in-person visits, risks, likely damage, etc. This information is beneficial in the claim adjustment process.

How does Virtual Risk Space support insurance brokers?

Helmet Broker is an insurance and reinsurance brokerage company that helps their clients improve business resilience and risk management capabilities.

With [VRS]™ Virtual Risk Space’s secure and comprehensive inspection infrastructure, Helmet Broker can now add international companies to their portfolio. They can provide service to more and more SMEs in various locations by providing easy remote inspections. Thus, it can contribute to the business continuity of SMEs, which are more at risk, especially during current uncertain times.

Using [VRS]™ Virtual Risk Space, which increases risk visibility and enables transparent information transfer between stakeholders, Helmet Broker can find capacity from global reinsurance companies and is able to insure both niche properties and large companies.

Wider adoption of these technologies not only helps restructure products but helps to understand how to manage risk. This may be achieved through capabilities such as end-to-end visibility of risks, scientific risk-scoring, affordable and real-time inspections and so forth.

Risk Engineering through Data Analytics

With data being the most critical asset for insurers, it is not surprising that this industry thrives on data analytics to make crucial decisions. Companies catering to various segments such as travel, health, life, etc., rely heavily on statistics to segment their customers.

How would a company group people into different risk categories?

The answer lies in analysing :

  • Customized survey assigned
  • Scientific risk scores
  • Cloud based audio & visual data

The benefits :

  • Helping prevent fraudulent losses
  • Optimising costs,
  • Saving time drastically
  • Expanding customer portfolio

Digital innovation and disruptive technologies like AI, predictive analytics, technological integration are not just science fiction but are here to stay. It is already time for insurers, brokers, and agencies to be compelled to break away from the shackles of traditional legacy systems and graciously embrace digital insurance systems.

Gain from Big Data implementation

As per YFS Magazine, it results in:

  • 30% better access to insurance services
  • 40-70% cost savings
  • 60% higher fraud detection rates

Thus, fusing technology with these data points requires big data technologies and predictive analytics. This would aid in risk assessment, price computation, reduction in insurance underwriting costs, improvement in claim grouping, and so forth.

Why [VRS]™ Virtual Risk Space?

If you are seeking a solution that assists you in making efficient and real-time decisions, Virtual i Technologies’ AI-driven risk assessment platform [VRS]™ Virtual Risk Space is ready for you.

Virtual i Technologies can make the renewal season a streamlined, transformational experience.

  • Make data-driven decisions
  • Gain 100% risk visibility in real-time,
  • Enhance the efficiency of your team by 40%

Connect with us today

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[VRS]™ Virtual Risk Space

Contact us to request a demo and start using an intelligent risk assessment platform now.

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