Insurance industry now leaning toward AI, blockchain

Amid the low penetration of insurance among Filipinos, Singapore-based insuretech (insurance and technology) company, Igloo, said Asia's insurance sector is undergoing a massive transformation to keep up with evolving market demands and maintain competitiveness with the use of artificial intelligence and blockchain technology.

In a statement, Igloo said that in the Philippines, where insurance penetration is at a mere 1.68 percent, the industry is grappling with persistent challenges such as complexities, outdated systems, and regulatory hurdles.

However, amid these obstacles, the industry is forging ahead with innovation and modernization with insurtechs emerging as crucial drivers of this change, fueling efficiency enhancements and elevating customer experiences.

“Insurtechs have facilitated the seamless integration of insurance into the purchase journey across diverse platforms, including e-commerce, fintech, and logistics. They have also made it possible for brick-and-mortar establishments such as convenience stores to become viable distribution channels to enhance accessibility and awareness of insurance products, bringing offline consumers online,” the company said.

On the other hand, insurtech firms empower insurers to create personalized products, meeting the unique needs of underserved sectors and effectively managing emerging risks in digital consumers' lifestyles today–these include pet insurance, travel insurance, electronic and mobile phone protection, and even micro, small, and medium business insurance.

Insurtech Igloo, amidst the industry's continuous transformation, identified key trends poised to persist in 2024, further elevating efficiency throughout the insurance value chain and propelling the ongoing momentum of embedded insurance and personalization.

AI-Powered data analytics

Igloo maintained that AI is fast becoming the insurance sector's cornerstone, revolutionizing how companies analyze data and assess risks.

“This year, we can expect insurers to increasingly leverage AI for advanced data analytics, allowing them to gain deeper insights into customer behavior, preferences, and emerging risks. By harnessing the power of AI, insurers can enhance their risk assessment models, leading to more accurate pricing and better management of uncertainties in the ever-changing market,” the Igloo study said.

Blockchain

Aside from AI, Igloo said blockchain technology's sustained influence in insurance underscores its pivotal role in streamlining claims processing.

“The decentralized and transparent nature of blockchain ensures efficient, fraud-resistant transactions, expediting claims settlement, and reducing administrative costs. This enduring trend continues revolutionizing the insurance landscape by enhancing accuracy, trust, and operational efficiency,” it said.

Other measures that can be instrumental to the insurance industry, according to Igloo, are zero-code platforms for swift product launch, digital empowerment of agents to boost productivity, and securing against climate change through insurance.

“Igloo believes the rising demand for personalized insurance in our region is prompting insurers and embedded insurance ventures to embrace the latest tech trends. By seamlessly incorporating these innovations, the leading regional insurtech firm is not just keeping up; it's staying one step ahead, shaping the future of insurance for Southeast Asian communities. Its commitment is to remain at the forefront of industry shifts, ensuring its approach aligns seamlessly with the evolving needs of its valued customers,” the Igloo statement read.

Igloo is the first full stack insurtech firm to emerge from Singapore. It has offices in Singapore, Indonesia, Thailand, The Philippines, Vietnam, and Malaysia and tech centers in China and India. With a mission of making insurance accessible for all, the firm leverages big data, real-time risk assessment, and end-to-end automated claims management to create B2B2C insurance solutions for platform companies and insurance companies.