Have you ever noticed how tech trends are influencing car insurance? From the outside, the automobile insurance industry may not appear to be the most innovative. However, broader changes in technological innovation and sustainability are causing a sort of revolution across industries, particularly in the insurance industry. But, what are some of the changes that govern such change, and how does that change manifest itself?
AI and Machine Learning
AI is one of our defining innovations, as it promotes a sea change in industry landscapes. Laypeople frequently use the terms AI and machine learning interchangeably to describe smart algorithms and computer systems. They are, however, distinct in that machine learning describes how artificial intelligence technologies become just that: intelligent.
As a result, AI and machine learning products are distinct. A machine learning algorithm could learn to sort and enter data on behalf of an insurance company, significantly reducing the time and money spent on minor administration.
Social Networking Sites
When it comes to data, ‘big data’ is a challenge that new technologies have presented to businesses of all sizes. With an increasingly connected world and the rapid acceleration of technological and data recording innovation, we as a society generate more data than we can possibly compute or understand manually. Social media is a prime example, with petabytes of data generated every hour ranging from uploaded photos to browsing patterns and other metadata.
A lot of this information is beneficial to many businesses, with insurance being a prime example. Machine learning software can be used to sort through metadata and analyze risk in relation to new customers more effectively.
IoT
IoT is an abbreviation for the ‘Internet of Things,’ and it refers to the recent phenomenon of systems and devices interconnected via a wireless internet connection. In the consumer realm, this is most commonly represented by home hub assistants like Alexa and Nest – and, more amusingly, by smart refrigerators’ Twitter-using capabilities.
However, in the context of automobile insurance, IoT is extremely viable as a new source of data – this time, data with direct and immediate implications for insurance policies and potential claims. Black boxes that are enabled by the IoT can be used to record information about a car’s location, speed, and distance traveled and send it back to the provider. This makes it possible to get cheaper car insurance that keeps an eye on how safely you drive.
Similarly, GPS and other telematic data can be used to confirm details of a crash or incident with both the driver and other insurance companies. This has the potential to significantly simplify the claims process, with independently verifiable data lending credibility to a given account or claim.
What Is the Importance of These Tech Trends?
But why are these trends important? There are numerous ways to answer this question, but the most significant impact of the preceding is on the consumers themselves. Consumers benefit from cheaper and easier access to insurance products, as well as better and faster results for specific claims, as car insurance companies streamline processes, eliminate costs, and speed up claims. As the industry tightens, consumers benefit as well.
Conclusion
The creation, distribution, and administration of insurance products are all being altered by technological innovation, which is profoundly affecting the auto insurance industry. Both artificial intelligence and machine learning are being used to improve risk analysis and automate insurance administration. Insurance companies are using social media data to better understand their customers and find risk factors. The Internet of Things (IoT) is enabling insurers to access data about driving habits and enhance claim processing. As a result of these technological advancements, insurance is becoming more readily available, cost-effective, and effective for consumers. As innovation keeps on propelling, we can anticipate that the vehicle protection industry should keep advancing and adjusting to meet the changing necessities of buyers.
