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At Aquarium, we think 2021 could be a milestone year for insurance. Digital disruption in the industry has been a topic of debate for many years, notably the pace at which insurance companies are adopting new technologies that will deliver long term transformation. This trend has not been hindered by the pandemic crisis. If anything, COVID has been a catalyst to speeding up adoption as insurers seek to secure more effective ways of doing business.
Strongest levels of investment yet
Insurance Times recently reported a record level of insurtech investment in the first quarter of 2021. The article refers to the Quarterly Insurtech Briefing from Willis Towers Watson, which found investment was up 22 percent from Q4 2020. Global investment in insurtech is now at a high of $2.55 billion USD. Interestingly, there has been significant funding for early-stage investments and an increase in investment raised by countries outside the North American hub.
Technology innovation in insurance is strengthening. Insurers in all sectors are more confident of the tangible operational efficiencies that technology can deliver. Although the shift towards digital started before the pandemic, Forbes alludes to the insurance industry seeing five years’ worth of digital acceleration since the COVID crisis hit.
Growth potential for pet-centric insurance
2020 was certainly a thriving year for Aquarium; our experience is that digital innovation in pet insurance is continuing at pace, especially in claims handling where automation can deliver instant efficiency improvements. We work with customers across the world, currently in Australia, New Zealand and the US and we see significant growth opportunities in all these areas. There is huge potential in the US pet insurance market as currently only around two percent of owners buy pet insurance. Insurers can harness digital technology to explore this from the outset.
When referring to the life assurance sector, Forbes also highlights that customer-centric, personalised insurance is key to future success. In pet insurance, brands like Lemonade are also advocating a pet-first approach. But what does this mean in reality?
Truly pet-centric insurance requires powerful and intelligent data management using Artificial Intelligence (AI) and machine learning (ML), that can tailor insurance policies to the needs of an individual pet. Aquarium’s digital platform is already enabling insurers to provide more accurate policies, improving customer experience and securing longer-term loyalty. AI and ML technologies are now mature enough to deploy and use at scale throughout the industry, and we feel that 2021 will be a pivotal year for insurers deciding whether to capitalise on these.