The world is connected now more than ever. The Internet of Things proceed it further than we can imagine. Moreover, it connects almost 50 billion devices to 8 million people. Therefore, people are linking with their homes, cars, health information, work, industry and community. Likewise, it is transforming the insurance industry.
Almost 81% of executives of insurance believe on connected insurance. Additionally, consumers are also willing to pay more for personalized, realtime services and sharing more personal data to get it. Likewise, it is reducing risks and tailoring pricing with precise real-time data. For instance, the insurer believes this gives better data for claims settlement. Basically, personalized risk protection services, data from smart homes and cars telematics can be used to meets the customers needs every day. Hence, it is significantly changing the industry. However, experts of the Internet of Things is developing new skills and analytic capabilities and digital ecosystem to build a new platform.
Though the adoption of technology is increasing still IoT facing some challenges which are to overcome in order to speed up the insurance industry. These challenges are :
Now we will discuss on the insurance industries where IoT is leading in exciting and flexible ways.
Home Insurance
Basically, the connected home is a win-win for both the insurers and the insured. So, the benefits of smart insurance fall into four categories:
1. Prevention is Better Than Cure
Firstly, the digital sensors around the home provide real-time alerts. Likewise, by connecting the sensor to the home’s water pipes, flow can be monitored continuously. As soon as an anomaly in flow rates is identified, the insurer is alerted to take proactive action. In addition, it also signals a fundamental shift for insurance as more than just a financial safety net. However, some of the smart devices which are used in connected insurance for home are:
2. Sticky Lifestyle App
Firstly, insurance is going to be an engagement. Therefore, with this engagement insurance, the customer gets something in return for their premium other than the peace of mind that they have financial protection in place. Similarly, smart insurance is all about comfort and convenience. Likewise, the customer is provided with features that go beyond the management of the insurance policy. For many customers, smart homes still falls into the tech category and its a real barrier to adopt. However, the smart home features are available in an insurance app, it is accessible to a wider audience.
3. Data and Insights
Basically, data is collected by the insurer for their own use in providing smart insurance. But in the near future, the customers will own their own data. Customers will offer data to insurers and third parties to quote for new business such as distributed blockchain and cryptocurrencies, like IOTA. The IoT opportunities can be categorized into three areas:
So, insurance is all about settling. The longer it takes to settle an insurance claim the more it costs the insurer. So, it is everyone’s interest to settle sooner. Cozify is the first smart home InsurTech platform.
Health Insurance
Basically, health insurance has become the key industry dominated by connected devices of IoT. In addition, the Internet of Things is replacing from long-term insurance policies into short-term customized solutions. In order to fulfil the needs of each specific customer and minimize the risks of losing funds, it requires precise data to fine-tune the policy. IoT-powered health insurance deals with the following processes:
1. Monitoring
Firstly, connected insurance provides the feature to track patient behaviour, activity and habits with the corresponding sensors in smartphones, wearables which collect data to analyze for predictive decisions.
2. Care Optimization
Basically, with the help of analytical tools and AI applied, insurers determine which clinical processes may have the better impact on patient’s wellness. Moreover, IoT includes insurers to provide additional services like telemedicine and virtual visits.
3. Payment System
As we know that the payment system is complex and may allow multiple payers, insurance firms, government as well as patients. For instance, care providers get compensation as they provide service to the policyholders.
So, the main benefit of implementing health in connected insurance is that health devices may give interests to insurance providers to create new custom products packaged for specific markets. But depending upon the circumstances and changes in personal lifestyle the status of the pricing model maybe change from fixed to fixable. However, data collected from IoT may give some insights on how specific services affect customer’s wellness and behaviour. According to the experts, the turn of the Internet of Things into the Internet of Human where integrated sensors are making our everyday life easier. Also, a new taste of science has made its first footprint on health, it is an ingestible sensor (a micro-chipped pill), a future of health-care.
Auto Insurance
Basically, the traditional method of premium calculation, settlement and renewal have remained for years. However, the Indian car insurance domain has recently been introduced to the usage-based insurance technology. Additionally, it allows that if one drives safe most of the time, his/her discipline on the road may earn her/him lower premium. However usage-based insurance use the IoT to monitor the behaviour of multiple drivers in multiple locations with the help of an odometer or a telematics device. The telematics devices which are installed into a specific port in the car can measure the following parameters:
The following are some connected insurance of car industries in India:
- Bajaj Allianz General Insurance
- Bharti Axa Car Insurance
- Icici Lombard Car Insurance
- HDFC Ergo Car Insurance
- Iffco Tokio Car Insurance
- New India Car Insurance
- Royal Sundaram Car Insurance
- Tata Aig Car Insurance
The following are some practical uses of connected car insurance.
1. Accident occurs
Basically, IoT devices in a vehicle provides the real-time information to the customer. So, the customer get alert notifications about the condition of the parts of the vehicle in order to avoid accidents.
2. Assistant in emergency
First of all, if an accident occurs the IoT devices will send notifications to the insurance companies. In addition, the nearest service centre will also be intimated in that emergency situation which reduces the reach time of the emergency facilities to the place of the incident.
3. Inspection of the incident
Basically, the advanced technology of IoT enables drones to locate, identify and inspect the area of the accident and report the damage to the insurance company. Moreover, this will reduce the effort of manual inspection by the inspector and make it more efficient and accurate.
4. Damage repair
Firstly, the customer can track the damage repair status on the vehicle and get the appropriate date for the completion of the repair using the IoT devices.
5. Track of stolen vehicle
One of the significant features of telematics technology is that it can track the stolen vehicles and also it monitors the safety of the driver.
6. Fraud detection
IoT technology has the potential to reduce the fraud in the car insurance domain. In addition, this facility enables insurers to be aware of the existing issues in automobile and it is easy to differentiate between the new and the old damages and expedite of the processing claim.
Here are some connected famous insurance industries :
Future of Connected Insurance Industries
In conclusion, from the above, it is clear that the role of IoT in insurance industry rather connected industries will continue to grow as insurers become more techie to fulfill the customers demand. So, the future will also be impacted by the increasing move to machine-to-machine communications, AI and cloud computing combined with IoT determining our movements and actions.
