Category ASTIN / NON-LIFE Bridging the Digital Insurance Divide

Bridging the Digital Insurance Divide

uploaded November 4, 2022 Views: 9 Comments: 0 Marked favorite: 0
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Description: Submitted by: Aldu Duminy - South Africa

  The advancement in technological innovations holds a promising opportunity for insurers to modify and manage insurable risks. Today, smart technology (telematic and wearable devices) is already being utilized by insurance companies to unlock cost efficiencies by improving the nature of actuarial risks such as: 

  • Mortality/Morbidity risks in life/health insurance and
  • Accident, damage or theft risks in short term insurance. 

However, due to the cost of smart technology, low- and middle-income individuals are less likely to benefit from the reduced insurance costs. Therefore, the barrier for these individuals to join the actuarial risk pool remains. 

Additionally, data scientists are unable to model solutions that will create value for these clients since they remain untracked.  

A shared-value solution to bridge the digital insurance divide, is for actuaries to price the monetary value of a customer’s data over their lifetime if they were to use a smart device. With the customer’s permission, the smart technology companies can sell these data points to other companies (e.g. insurers). The value from this data can be shared through discounts when individuals purchase these devices. Such a data market will increase the data pool and enable sustainable, innovative insurance models for all. 

 

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