How Does Technology Transform Life Insurance?

This comprehensive guide provides an in-depth look at the latest life insurance technology trends, helping you make proper decisions about the best coverage for your needs.

Fremont, CA: Purchasing insurance has always been a complicated affair. Choosing to purchase life insurance is the initial step, and it is seen as "emotionally heavy." The purchasing process is intimidating because of the lengthy proposal paperwork and numerous inquiries regarding personal, family, and lifestyle medical histories. Supplying necessary paperwork for Know Your Customer and sometimes Know Your Client (KYC), income verification, and other purposes, as well as doing physical examinations—the list goes on and on. Underwriters may require up to six weeks to evaluate an individual's risk and determine whether to issue the policy, even after submitting your form.

But as artificial intelligence (AI) becomes more thoroughly ingrained in the life insurance value chain, the complications will eventually end! The life insurance industry is changing; underwriting, costs, and the claims procedure won't be the same.

Technology Trends is Changing Life Insurance

Three significant technological advances are transforming life insurance underwriting and claim processing.

Avalanche of Data from Connected Devices:

The amount of data gathered from linked devices (IoT) is increasing. New categories of devices and sensors, such as eyewear, shoes, medical devices, etc., are added to the list, and the penetration of devices like smart homes, intelligent automobiles, telematics, wearables, etc., is growing.

To provide individualized plans and pricing, insurers can better understand their consumers and analyze risk at the individual level, thanks to the copious amounts of data that these linked sensors are gathering.

Emergence of Shared Data-Ecosystem:

To improve the customer experience, several public and commercial organizations are collaborating to build an ecosystem to share consumer data. With the client's cooperation, insurers can use this alternative data to evaluate underwriting risk in real-time, expedite issuance, or verify claim data to shorten the time needed to approve a claim.

Customers own the data; thus, they can transmit their data and risk profile if they move their policy from one insurer to another.

Advancements in Cognitive Computing:

With the dramatic reduction in processing costs and the increasing availability of data, algorithms are continuously learning and adjusting to their environment. Based on the idea that humans learn by decomposing information and drawing conclusions, cognitive computing, also known as deep learning models, mimics human neurons.

The pre-trained models and plug-and-play platforms are becoming more widely available, making it easier for insurers to obtain them at a low cost and enhance them further by adding customer data.