2023 Signals that are Shaping the Future of Insurance  April 17th 2023

2023 Signals that are Shaping the Future of Insurance

Technology enablement, cloud, ecosystems, data accessibility, AI, risks, products, and customer sentiment are pushing insurance out of tradition and into innovation faster than some may like.

Talk with anyone in the insurance industry and mention that “times are changing,” and you get no argument. Not only are insurance and the insurance industry changing, but change is changing. Technology enablement, cloud, ecosystems, data accessibility, AI, risks, products, and customer sentiment are pushing insurance out of tradition and into innovation faster than some may like. Yet, for the most part, all of the pushing is moving insurance in the right direction. The trends might be fearful in pace, but they certainly aren’t fearful in the result. Insurance may be improving itself in ways that will benefit the world. What kinds of benefits can we expect?

• Greater coverage — more people and more businesses may find themselves covered through more relevant options and fewer steps to usage, including embedded coverage, reducing the insurance coverage gap.
• Greater predictive protection — insurance may improve underwriting profitability, reduce its own costs and customers’ costs through a dramatic uptick in data-driven risk assessment for underwriting as well as avoidance or mitigation through proactive solutions.
• Greater efficiency and effectiveness — insurers are right now grappling with operational challenges including talent shortages and tech debt that will give them the “excuse” to redesign their operating models and introduce better solutions and ecosystems to improve operational results.
• Greater resiliency — a rapidly-growing set of risks is likely to touch off two ancillary trends: new product development and better risk knowledge and response.

To help us sort through these trends and others, Majesco invited three industry insurance technology experts to carry the conversation further, asking them about what they are seeing as the telltale signals that will shape our futures in 2023. To see and hear their insights, you can view the 2023 Signals that are Shaping the Future of Insurance webinar, and also dip into some of the high-level thoughts in this blog. Our panel includes:

Chris Frankland, InsurTech & FinTech Global Advisor & Mentor

Adrian Jones, Partner, HSCM Ventures

Dr. Henna A. Karna, General Manager (GM), Managing Director, Global Insurance & Risk Management Solutions – Google

Denise Garth, Chief Strategy Officer — Majesco

Sfara Expands Emergency Service Capabilities to Nearly 40% of the World’s Population

Sfara announces the addition of India to its already impressive list of countries covered by its emergency support that includes call center and first responder services. With the addition of India, Sfara’s services now cover nearly 40% of the World’s population.

"...if you are a European or from the Americas, you can still be covered if you travel to India for a few days or a few months,” said Erik Goldman, CEO of Sfara.

This means that customers on the Sfara platform are covered, not only in their base country, but also while traveling to other countries where Sfara offers services, like India (where you wouldn’t assume to be covered by your emergency service plan while traveling). Sfara continues expanding services to new countries and territories to achieve its goal of worldwide emergency coverage for everyone.

“One of Sfara’s goals is to provide transportable safety on the smartphone, so that anyone can be covered by emergency services no matter where they go. With the addition of India to our services, if you are a European or from the Americas, you can still be covered if you travel to India for a few days or a few months,” said Erik Goldman, CEO of Sfara.

Sfara’s services include crash detection and response, plus personal safety through features like the innovative Sfara Triple-Tap™, which contacts an emergency coordinator when the phone is tapped three times successively. This makes a discreet call for help when someone is faced with an active threat.

With Sfara’s Pre-enabled Industry Solutions, companies can get up and running quickly and easily with Sfara’s mobile SDK and cloud platform. Sfara’s first customer to offer services in India is eDriving, who has integrated Sfara’s SDK into their Mentor app. eDriving is a Solera company.

AI Speeds Insurance Claims Estimates for Better Policyholder Experiences

Drivers can get auto repair estimates in seconds instead of days with AI-driven insurance applications from CCC Intelligent Solutions with an assist from NVIDIA DGX Cloud and Base Command Platform.

CCC Intelligent Solutions (CCC) has become the first company in the auto insurance industry to deliver an AI-powered repair estimating solution, called CCC Estimate – STP, short for straight-through processing.

The Chicago-based auto-claims technology powerhouse uses AI, insurer-driven rules and CCC’s vast ecosystem to deliver repair estimates in seconds, instead of days. It’s a technological feat considering there are thousands of vehicle makes and models on the road, and countless repair permutations.

The company’s commitment to AI spans many years, with its first AI solutions hitting the market more than five years ago. Today, it’s working to bring AI and intelligent experiences to key facets of claims and mobility for its 30,000 customers, who process more than 16 million claims annually using CCC solutions.

“Our data scientists play a crucial role in creating new solutions and the ability to build models, experiment and easily integrate the model into our AI workflows is key,” said Reza Rooholamini, chief scientific officer at CCC.

NVIDIA Blog

Claims-made vs. Occurrence coverages - Part 1

What happens when an insured decides to move from a claims-made policy to an occurrence-based policy, or vice versa?

FC&S recently responded to a question from a subscriber regarding a policy for an insured who moved coverage from a claims-made basis to an occurrence form. Under the claims-made policy the insured had a retroactive date going back to 2002, but in the occurrence policy, while referencing a retroactive date of coverage, the retroactive date was shown on the declarations as the same date as the policy effective date: April 18, 2022. This is the first of a two-part series addressing the issues surrounding the differences in coverage. Part 2 of this series will appear on April 14, 2023.

So what happens when an insured decides to move from a claims-made policy to an occurrence-based policy, or vice versa? How does this affect claims under each coverage form, and how might the agent’s errors and omissions be triggered?

Claims-made vs. occurrence

First, we need to understand the difference between claims-made coverage and occurrence coverage. Stated simplistically, claims-made coverage provides coverage for claims that are made to the insurer during the policy term for injuries, wrongful acts, errors or omissions or whatever the coverage applies to (we’ll refer to these as injury) — as long as such injury was not committed prior to the retroactive date shown on the policy. Conversely, an occurrence policy covers claims that occur during the policy term and there is no need for a retroactive date, since the date of the occurrence is what triggers the coverage.

Claims-made vs. Occurrence coverages - Part 2

A claim presented for coverage will be viewed differently under a claims-made policy vs. under an occurrence policy.

Part 1 of this series examined coverage may or may not apply for a claim filed under a claims-made policy vs. an occurrence policy, based on a question FC&S received regarding a policy for an insured who moved coverage from a claims-made basis to an occurrence form. The claims-made policy had a retroactive date going back to 2002, but in the occurrence policy, the date shown on the declarations was the same date as the policy effective date: April 18, 2022.

Tail coverage

A claims-made policy will include a basic extended reporting period, such as 60 days following the end of the policy expiration. This gives the insured a limited time to report claims that take place during the expiring policy period. The unknown and unreported occurrence will be automatically covered under the expired policy only if the claim is first made within 60 days after the end of the policy period. There is no charge for this basic extended reporting period – also known as tail coverage. The basic tail and the option to purchase a supplement tail are provided if the policy is canceled or not renewed by either the insured or the insurer. They are also provided if the insurer renews or replaces the policy with one that either has a later retroactive date or applies on an other than claims-made basis.

GM expects connected car platform to reach 1mn vehicles by 2024

General Motors' (GM) connected car platform will end this year with nearly 400,000 connected vehicles and is expected to reach 1mn by 2024.**

Last year, GM had 250,000 vehicles with mobile connectivity in the region and it forecasts that figure to reach 2mn by 2026, Jaime Gil Toledo, South American director of GM subsidiary OnStar's platform, told BNamericas during the IoT Day 2023 event in Buenos Aires, Argentina.

All of GM's connected vehicles have a telemetry connection to the manufacturer. In addition, it offers a subscription that includes capabilities such as vehicle security and recovery, information on driving habits and car health, as well as in-vehicle Wi-Fi.

Of the nearly 250,000 connected vehicles in Latin America, some 46,000 users subscribe to GM services. By 2026, the company aims to reach 630,000 users with an active subscription.

Currently, 33% of GM vehicles are connected. The company predicts that proportion will rise to 86% in 2023 and 90% in 2026.

The market in the region with the largest number of cars connected with OnStar is Brazil, followed by Argentina, Gil Toledo said. Then come Colombia and Chile, which have roughly similar figures.

Claro, América Móvil's operator, is GM's connectivity partner in eight Latin American markets. The telco is also in talks with other automakers hoping to roll out services similar to GM's.

The company provides the eSIM and 4G connectivity for the vehicle. Claro has also been integrated into GM contact centers so that the user has a single channel of communication for OnStar services.

According to figures from General Motors, connected vehicles represent a global business of US$250bn-300bn.

Why insurers struggle to transition coverage to protection

We need to have an honest conversation about the state of insurance. 

Annual results show a mixed bag of success. But whether insurers hit their quarterly numbers or not, it increasingly looks like a sector in trouble. 

Trust is at an all-time low due to poor experience and the sector's inability to meet consumer expectations. It feels like the real value of insurance is waning, and it's losing the heart of its customers.

Rory Yates, SVP Of Corporate Strategy, EIS

Slightly less active 2023 hurricane season forecast

Colorado State University said Thursday it expects the 2023 Atlantic basin hurricane season to be slightly less active than average as it released its initial forecast.

The forecast calls for 13 named storms, compared with a 1991 through 2020 average of 14.4. Named storm days are forecast to be 55, compared with the average of 69.4.

Six hurricanes are forecast, against an average of 7.2, and hurricane days are projected at 25, compared with an average of 27.0.

Two major hurricanes are forecast with five major hurricane days, compared with 3.2 and 7.4, respectively.

Researchers cited the likely development of El Niño as a primary factor for their below-average forecast but noted an elevated uncertainty due to the behavior of meteorological indicators.

“Given the conflicting signals between a potentially robust El Niño and an anomalously warm tropical and subtropical Atlantic, the team stresses that there is more uncertainty than normal with this outlook,” the CSU report summary said, adding “there is considerable uncertainty as to how strong El Niño would be if it does develop.”