The Latest Insurance Technology is Transforming the Industry
The right insurance technology cuts down on fraudulent transactions, automates services, and reduces operational costs. As a result, insurance providers can focus their resources on other important tasks such as attracting new policyholders. Exciting new technological innovations can greatly benefit the insurance industry — whether through promoting healthier lifestyles or providing a seamless customer onboarding experience.
Internet of Things
Internet of Things (IoT) describes the network of physical devices that automatically share information with each other over the internet.
Insurers are able to leverage the real-time data they receive from connected devices in order to enhance risk assessment, set accurate prices, and reduce costs.
Machine Learning
This powerful AI-based software solution relies on complex algorithms to analyze large volumes of data without human supervision. After a while, the software can make decisions by itself.
Machine learning algorithms can be trained to automate important tasks such as calculating rates, underwriting, insurance claims management, and fraud detection.
Problems with Machine Learning
In order to be effective, machine learning requires huge volumes of high-quality data to properly train the algorithm.
Sophisticated machine learning algorithms study relevant datasets in order to uncover hidden relationships in the data, enabling them to make inferences and predictions.
Also, over time, machine learning solutions make decisions that become practically impossible for humans to understand.
Rules Engines
Business rules engines empower non-technical subject-matter experts to create, manage, and update insurance products without waiting for assistance from the IT department.
A business rules engine can help an insurance carrier to increase their time to market by enabling subject-matter experts to create, manage, and update insurance products by themselves.
Non-technical Insurance agents and executives with only basic software knowledge can instantly create and deploy new products in a fraction of the time it usually takes because rules engines were designed to be user-friendly.
What is a Business Rules Engine and How Does it Work?
No review of insurance technology is complete with business rules engines. Put simply, a business rules engine is a robust piece of software that runs business rules. Think of business rules as conditional if-then statements that streamline mission-critical activities of an organization. These powerful conditional statements are the directions that tell your software how to run your business operations.
For instance, an online retailer could use the following business rule to set its discount policy:
When a new customer purchases car insurance and has already purchased home insurance, then approve them a 15% discount.
Business rules are able to describe laws, best practices, and business goals.
What makes rules engines a must-have for most insurance carriers is the fact that they automate tedious and complicated tasks while preventing potentially expensive errors.
Application Programming Interfaces (APIs)
An Application Program Interface (API) is a collection of protocols and tools built to facilitate software development. APIs are closely related to the Internet of Things because they allow for the secure exchange of data over the internet between connected devices and applications.
However, since APIs can transform a wide variety of physical objects such as cars, medical instruments, or even thermostats into an important source of information for insurance providers, it’s critically important to deploy APIs that are secure and scalable.
Bottom Line
These innovative technologies are designed to help insurance carriers revolutionize their business processes — from product development and underwriting to risk assessment and fraud prevention.