Our insurtech predictions for 2022
There’s so much to look forward to in 2022. It’s the Year of the Tiger. There’s a World Cup in November. And, of course, the sands of insurtech will keep shifting.
Here at 11:FS, we’ve got smarts. So we asked some clever folk to sift through the tea leaves and make their predictions for the year ahead. They were Sarah Kocianski, John Bean and Rick Fox. Nigel Walsh even made an appearance via hologram à la Tupac at Coachella 2012. Not really. It was just a voice recording.
But anyway. Listen to our Insurtech Insider predictions episode here. Or enjoy some of the written highlights below. Or do both. I’m not the boss of you.
To start with we put a few industry guesses under the microscope...
Insurance premiums are going to go up
Don’t shoot the messenger. According to the Swiss Re Institute, we can all look forward to a 2.8% increase in cost. What will the knock-on effects be?
We’re in a hard market cycle. Which means prices going up across the board. Which can lead to customers shopping around. Which can lead to industry innovation.
Companies should be mindful of the value they’re bringing their customers in light of these rising prices. Improving your service in any way, shape or form is guaranteed to offset some of that ill will. Enter stage right, insurtechs.
Companies should be mindful of the value they’re bringing their customers in light of these rising prices.
Climate change and sustainability are key topics
Scenes reminiscent of The Day After Tomorrow have become all too familiar in the last 12 months.
P&C insurers are on the ropes in the wake of rising catastrophe claims. Across Europe, asset investment stands at over €10tn. The push to align asset portfolios with ESG goals could have a major impact on the market. But the industry has no choice.
Insurers are buckled up to accelerate growth
Intriguing. What does it mean?
Well, it means a lot of people in the sector are holding out for a big economic recovery this year. Despite big losses to the twin pillars of Covid and climate change, Swiss Re predicts the insurance industry will bounce back in 2022.
Does the claim hold weight? You could make a good case that people have realised the importance of insurance in the last 18 or so months. And you could also argue consumers will be a lot more savvy in terms of choosing their cover. The burden is on companies to make their products and services as transparent and simple as possible to meet this increase.
You could make a good case that people have realised the importance of insurance in the last 18 or so months.
By his own admission, John cheated and mentioned a few that came under the ‘data’ umbrella. Hmm. We let him off on a technicality.
Embedded insurance was first up. The logic is sound. Embedded finance has gained a lot of traction over the last couple of years thanks, in part, to Open Banking. This has triggered a groundswell of new market entrants.
Surely we’ll see something similar with insurance. And if so, we can all look forward to a bit more personalisation, affordability and reach.
Number two? Real-time data. It should come as a surprise to no one that insurance is a data business. And capturing said data once or twice a year just doesn’t cut the mustard anymore.
Not when real-time data is freely available. It’s a game changer. Expect both old and new players putting it to use. And new products, services and ecosystem orchestrators coming to the table as a result.
Technology is table stakes.
Technology is table stakes.
The reality is that most players in this industry are successful. They’ve encountered some pretty big hurdles in the last 15 years. The housing crisis. The pandemic. And they’ve emerged relatively unscathed.
The need for technology was writ large by Covid. But the industry is notoriously laggard and take-up was slower than hoped in 2021. That just won’t do this year.
If you’re not using technology for self-service, data collection and automation, prepare to fall by the wayside.
The big companies will need a hand in all things personalisation and data. The ones built on legacy infrastructure and comprising lots and lots of smaller companies.
These giants will invest in services that help them better understand their own systems and make the best use of their data.
We’re gonna see a big shift into underdeveloped markets. Geographies like Africa and Latin America represent a big market opportunity. And right now, they’re pretty untapped.
Let’s see what happens.