The insurance industry is evolving to stay relevant to consumers and take advantage of technology; a paradigm shift in the insurance world is under way.
InsurTech is the love child of traditional insurance and modern technology with its data management capabilities. It is redefining the industry’s standard from the silo model (read about that here) to an ecological model. The “ecological model”:
- Offers a holistic picture of risk management resulting in improved premium pricing and the ability to create robust claims reduction and prevention strategies.
- Takes advantage of near real-time data to analyze risk and claims information on a continual basis.
- Utilizes technology to streamline and roll up data, giving Senior Administrators a bird’s eye view of the organization and the ability to step into the decision-making process.
- Spends less time on assessing and reporting, and allocates more resources to implementing solutions.
- Is based off a continual cycle of self-regulation and evolution resulting in efficiency and flexibility that increase overall resilience of the organization.
There are a handful of ways an ecosystem and the Insurance industry relate: Here’s one.
The Feedback Loop
Here’s the essence of a feedback loop; There is a cause, which has an effect, and the effect reinforces or alters the original cause. Risk assessment data is collected, collated and evaluated. After the analysis, the new information is fed back into the system. Action steps are generated and the results of implementation are fed back into the system; the cycle continues.
Ecosystems have used this feedback model to mitigate risk and maximize the potential to thrive for millions of years, and we continue to see an uncharted number of diverse lifeforms thriving on our planet.
But what’s most important of all, the feedback model allows for evolution and innovation.
Imagine modeling self-insurance and group purchasing around this ecosystems concept.
- The silos separating information are broken down.
- The member of the group, the field consultant, local client contact, and other key players access one central location to input and access data.
- Program administrators and risk staff can evaluate trends and determine whether their best practices and solutions are garnering the expected results.
- Senior Administrators also have access to this database at the client and group purchasing level.
- All of this risk management data is analyzed and feeds back into the system where micro-adjustments are made based off the new information.
- This knowledge is reported globally and locally, giving access to each player in the ecosystem and allowing for more focused efforts.
Risk Management is becoming its own science. A flexible, intuitive, and resilient model is beginning to take the spotlight.
Is your company embracing the value of this kind of risk management?
Learn about how In2vate caters to the future of risk management here.