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10 trends that will shape insurance in 2021



2021 will surely bring lots of surprises, but ten trends – including "growth of the giants", a race towards green, the transition to use-based coverage and Bitcoin as a new asset class – look set to have a major impact on the insurance industry in the coming year.

The COVID-19 pandemic has reminded us of the folly of trying to predict the future. But it has also helped us to imagine what that future might look like.

Few people in early 2020 predicted the devastation caused by the COVID-19 pandemic around the world. It overshadowed everything else that happened last year. All predictions from economic analysts, market researchers and investment gurus were surpassed by a global event that almost no one saw coming.

When we look forward to what 2021

can hold, it is good to remember how unpredictable our world really is. If it were not, we would not need insurance. Our livelihood is dependent on uncertainty.

What major events will send tremors around the world in the next 12 months? Fluctuations in geopolitics, economic surprises, technological breakthroughs, another pandemic? We do not know. However, we can identify important trends that emerge in the wake of the COVID-19 pandemic.

Unforeseen global or regional events may still affect the development of these evolving trends, but they are already beginning to gain momentum. Many of them have been accelerated by the pandemic. Detecting them early will enable insurers to adapt their businesses to the changing needs of their customers and deliver new, potentially lucrative, products and services.

Here are 10 trends that I see have a major impact on the insurance industry in 2021. [19659008] Trend 1: Increase in health and wellness services

The COVID-19 pandemic has driven health and well-being at the forefront of customer concerns. Insurers have responded by strengthening their traditional medical and life insurance policies with a range of digital health and healthcare products and services. Carriers who quickly establish a strong presence over the health ecosystem will have a major advantage over competitors.

Trend 2: Phygital becomes the standard

Digital service and distribution channels will challenge carriers' traditional channels as the primary point of customer engagement. , but the efforts of physical channels and experts will still be sought after for advice on complicated decisions and offers. Consumers have flocked to use the digital services during the pandemic and few will return to their previous habits. Digital services that are seamlessly combined with phygital experiences, especially on mobile platforms, will emerge as the main difference when consumers buy insurance. The transport companies that are slow to launch attractive digital offerings will lose customers.

Trend 3: More insurance companies dare beyond insurance

Advances in digital technology open up a number of opportunities for insurance companies that are keen to expand outside their traditional markets. The flat premium income and the low investment return forecast for 2021 will accelerate this trend. Expect airlines to announce some surprising partnerships as they look to broaden their revenue base.

Trend 4: Niche products shine

Insurance companies launched a series of innovative risk management offers in the wake of the COVID-19 pandemic. Demand for tailor-made products, such as coverage for small businesses for business continuity, protection against IT threats, pandemic insurance and event interruptions, will increase. The interest in insurance products aimed at specific demographic groups, such as young adults or pensioners, will be particularly strong and present partnership opportunities between established and insurtechs.

Trend 5: The giants will grow

Innovative new insurance companies have been in the spotlight. in recent years and attracted significant funding. However, traditional carriers will emerge this year. Their asset strength and extensive internal resources enable them to cope with any unfavorable economic conditions and secure new revenue opportunities. The insurance industry is likely to see some significant mergers and acquisitions in 2021.

Trend 6: Confidence becomes non-negotiable

Consumer confidence will be an important part of the business in 2021. Consumers will not only expect their suppliers to perform well service and value for money, they will also require that they protect their personal information. In addition, they will expect their suppliers to behave ethically in all parts of their business. Insurers who are perceived to have violated customers' trust risk significant reputations.

Trend 7: Sustainability is the future

Insurers will be under increasing pressure this year to show their support for sustainability initiatives that address climate change, environmental pollution and social injustice. Carriers that are proactive and make visible changes in their organizations to address these issues and become truly "sustainable insurance companies" will outperform competitors. They will strengthen their brand and avoid having to catch up with statutory requirements that may be prescribed later.

Trend 8: Race to & # 39; green & # 39; quickens

As fossil fuels continue to lose favor with regulators, shareholders and consumers, insurers will increase their green energy commitments. Expect some carriers to cut ties with fossil fuel companies. Car insurance companies are likely to introduce more incentives for their customers to switch to electric cars. Some may advertise their intention to stop providing coverage for petrol and diesel vehicles.

Trend 9: Fixed premiums expire

Demand for payment service insurance services is increasing as more and more consumers enjoy the flexibility and cost savings offered by these new offerings. Expect at least one major car insurance company to lose fixed premiums and switch completely to usage-based fees. Other airlines will soon follow.

Trend 10: Cryptocurrencies are shining

As low interest rates continue to dampen insurers' return on investment, airlines will increasingly look at the possibility of adding new asset classes to their portfolios. Cryptocurrencies, especially Bitcoin, are supported by a growing number of financial services companies. MassMutual recently invested $ 100 million in Bitcoin for its public investment fund. Expect that many other airlines will start adding cryptocurrencies to their investment portfolios.

No matter what year comes, I'm sure it will bring many surprises. Let me know if you think I have any trends I have identified. Send me a message. I'm anxious to hear your views.

Until then, I wish you well and rewarding 2021.

Disclaimer: This document is for informational purposes only and does not take into account the reader's specific circumstances and may not reflect recent developments. Accenture disclaims, to the extent permitted by applicable law, all responsibility for the accuracy and completeness of the information in this presentation and for any acts or omissions made based on such information. Accenture does not provide legal, regulatory, auditing or tax advice. Readers are responsible for obtaining such advice from their own legal counsel or other licensed personnel.
Disclaimer: This document refers to trademarks owned by third parties. All such third party trademarks are the property of their respective owners. No sponsorship, endorsement or endorsement of this content by the owners of such brands is intended, expressed or implied.


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