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Insurance sector poised to benefit from technology

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Insurance sector poised to benefit from technology

NEW YORK — Technology such as telematics and data capture are helping the insurance industry in many ways, according to insurers and brokers.

Technology can even help inform underwriting and alter the customer experience, they said Tuesday at Fitch Ratings Inc.’s North American Insurance Conference.

“Technology helps us know more about more things with more certainty than ever before,” Robert Bauer, head of innovation and sharing economy practice group for American International Group Inc. in New York, said. “Isn’t that a gift to an underwriter?”

Nate Collins, assistant vice president for digital transformation strategy at American Family Mutual Insurance Co. S.I. in Madison, Wisconsin, said technology “is a way to create a better customer experience or solve for operational inefficiencies.”

As a broker, Adam Troyer, managing director for reinsurance solutions at Aon Benfield in Chicago, sits in between and among many insurtech companies, startups, and clients looking to embrace emerging technologies. “Large companies have teams focusing on technology, but many smaller companies don’t, yet still want to take advantage of that technology,” he said, adding Aon tries to help firms all along that spectrum.

Telematics was singled out as an example of a technology that can provide more information about something like driving, Mr. Bauer said, including data on variables such as speed, acceleration, braking and more.

“There’s telematics for cars, for gas turbines, for humans, if you want to think about that as wearables,” Mr. Troyer said, emphasizing the widespread use of the technology.

Telematics, he continued, allows the pricing of insurance to be much better informed, citing Progressive Auto, which he called the leader in telematics, as an example, saying that according to the company using driving behavior via telematics was 40% to 50% more predictive than other metrics like credit score.

“The sweet spot is wrapping coaching and programs around” the driver experience data collected by telematics “to change customer behavior,” Mr. Collins said. Drivers, for example, could be instructed on how to improve behavior to become a better risk.

 

 

 

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