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August 17, 2020updated 18 Jan 2022 5:00am

Can AI and machine learning make the insurance experience a joy?

By Patrick Brusnahan

Insurance has often been regarded as an unwieldy process. However, with developments in artificial intelligence (AI), could the insurance experience be ready for a change? Patrick Brusnahan speaks to Munich Re about the changing course

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What will drive the cyber insurance market over the next 3 years?

The global cyber insurance market was worth $7bn in gross written premiums (GWP) in 2020. It will reach $20.6bn by 2025, as the market will continue to thrive post-COVID-19. Our recent report on Cyber Insurance reveals that cybersecurity was thrust into the spotlight in 2020 as COVID-19 forced businesses to digitize their processes and adopt remote working practices overnight. The pandemic also presented an opportunity for cybercriminals to exploit global panic, with a surge in cyberattacks occurring in 2020. The need for cyber insurance is apparent, but the market is not as easy to navigate as it once was. Use our report to guide and help you to:
  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and insurance models begin to enter the fray.
  • Prepare for how regulation will impact cyber insurance over the next few years.
Download the full report to understand what to expect and how to align your business for success.
by GlobalData
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Convenience has been a staple of the digital age. With BigTech firms such as Amazon and Google providing a customer experience previously considering impossible, customers expect this from everyone now.

Munich Re is one of the world’s largest insurers with a large amount of history behind it. That has had not hindered it from making a number of technological advances.

It has previously backed firms across insurtech, digital health, deep tech sectors.

In the digital insurance arena, it has raised capital for US firms including Next Insurance, Inshur, and Hippo Insurance.

Furthermore, Munich Re Specialty Insurance (MRSI) teamed up with Duck Creek Technologies to create advanced digital platform for ‘best-in-class’ service and product innovation.

Duck Creek will help MRSI in overhauling its technology infrastructure with a digital-first, cloud-native offering.

The insurer will leverage Duck Creek’s end-to-end SaaS solution OnDemand platform.

OnDemand will the insurer all services, support and computing resources needed to move faster and more efficiently.

However, as a whole, the insurance industry is seen as slow to adapt. For customers, taking out a policy is an arduous process. Is the industry changing this and, if so, why has it taken so long?

Making things easier

Speaking to Verdict InsurTech, Paul Donnelly, executive vice president for EMEA at Munich Re Automation Solutions, says: “The elephant in the room is that insurance companies have been considered to be slow to adopt change and technology.”

He continues: “The other side of that coin is that insurance is very much a relationships business. Quite often, significant transactions could have been done on a handshake. Then this moved forward into very simplified contracts. In some ways, the reliance on relationships and personal contacts sometimes has not acted as a bridge to change and adoption of the new leap forward.”

However, Donnelly also claims that the insurance industry not adopting change is a misnomer. In fact, many, including Munich Re, starting rolling out these types of technology “15 or 20 years ago”.

What automation and convenience comes down to, according to Donnelly, is “human expectation”.

Human expectation for the insurance experience

Donnelly explains: “We all live in a world where it’s very easy to transact remotely for all ranges of goods on the internet, and therefore, insurance is a real outlier.

“People’s expectations are everyone else can do it, but insurance is really jarring with complex insurance products.”

That is one difference that Donnelly highlight between insurance firms and the likes of Amazon. While buying a book or a CD are basically the same transactions, insurance “provides a range of products, the difference between which can be quite subtle”.

There are multiple benefits to embracing automation and improving the customer experience in insurance with AI. As Donnelly explains, it brings a differentiator to the field.

He concludes: “There have been organisations who have sought competitive advantage in offering a better service to either the customer directly or to a market which is populated by independent financial advisors. Obviously, if you can provide a better service to the broker community, you can provide greater clarity sooner and they will instinctively lean towards including you. Then they can gain some sort of preference for you because you make the journey easy for them. You make the journey swift for their clients.”

Free Report
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What will drive the cyber insurance market over the next 3 years?

The global cyber insurance market was worth $7bn in gross written premiums (GWP) in 2020. It will reach $20.6bn by 2025, as the market will continue to thrive post-COVID-19. Our recent report on Cyber Insurance reveals that cybersecurity was thrust into the spotlight in 2020 as COVID-19 forced businesses to digitize their processes and adopt remote working practices overnight. The pandemic also presented an opportunity for cybercriminals to exploit global panic, with a surge in cyberattacks occurring in 2020. The need for cyber insurance is apparent, but the market is not as easy to navigate as it once was. Use our report to guide and help you to:
  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and insurance models begin to enter the fray.
  • Prepare for how regulation will impact cyber insurance over the next few years.
Download the full report to understand what to expect and how to align your business for success.
by GlobalData
Enter your details here to receive your free Report.

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