Insurtech, or insurance technology, is revolutionizing traditional insurance companies by enhancing risk management and automating the insurance value chain, with funding reaching $2.55 billion in 2021. The COVID-19 pandemic has accelerated the digital transformation in insurance, necessitating an adaptation of strategies, customer experience, and operational processes. Overall, insurtech is pivotal in addressing challenges within the industry, leading to increasing revenues and a promising future for insurance.

1. The Challenges and
Solutions of Insurtech
Impact of technology in the insurance industry. ​

2. What is Insurtech?​
Insurtech, or insurance technology, is the
key to reinventing traditional insurance
companies into cutting-edge powerhouses
for risk management.​
• Insurtech funding reached $2.55 billion
in 2021.​
• Buying, managing and renewing
insurance is set to go completely digital.

3. History of Insurtech ​
• Insurtech emerged in 2010 shortly after
fintech had started revolutionizing
finance.​
• Long before insurtech was synonymous
with big data and machine learning, its
purpose was to automate the insurance
value chain through simple
transformations​
• Insurance carriers progressed to being
able to streamline their organizational
structures, double their profit, and
reduce operating costs.

4. The Three Facets of Insurtech​
• Insurtech Enablers: This is the process of partnering with
incumbent insurers instead of competing with them and building
solutions for specific value chains within the insurance industry. ​
• Insurtech Marketplaces: Insurtech marketplaces occupy the e-
commerce insurance space. They have helped facilitate policy
comparisons and ease of purchase. ​
• Full-Stack Insurtech: Companies that use data-driven tools to
produce flawless customer service.

5. What are the Findings?​
• Insurtech has long remained client-oriented.​
• According to PR Newswire, this focus was enhanced as
millennials took over the purchasing space from baby boomers.
This has led to drastic differences in consumer behavior, and
companies had to act fast.​
• Insurance combined with technology was quickly found to be a
value-creating mechanism.

6. A Different Approach ​
In a financial Services Practice report by Mckinsey, insurance carriers
are recommended to rethink their approach in 6 areas of insurance
digitalization:​
• Strategy: A successful strategy adapts to robust industrial trends and
practices.​
• Customer centricity: The center of all digital innovation is improving
customer experience. ​
• Business processes: Processes must boost customer experience and
reduce operational costs. ​
• Organization: All organizational models, including corporate culture,
must support digital tools.​
• Technology: Technology ought to maintain transactional systems. ​
• Decision making: Big data resulting in actionable insights.

7. Where Does This Leave Us?​
• The Covid-19 pandemic has seeped into 2021, and insurance
companies are, as a result, racing to digitalize business
operations and client relationship management.​
• Most importantly, the insurance industry must evolve in a world of
continuous and steadfast change. While risks get elevated on a
daily basis, premium rates are also increasing​
• Insurtech is the driving force behind filling such institutional gaps,
and the result can be observed in insurtech companies increasing
their total revenue year after year.
The future of insurance is bright.

8. Learn more about challenges and solutions of
Insurtech