Since 2011, interest and investment in insurtech has exploded exponentially. In 2011, $140 million was invested. By 2015, it was $2.5 billion, according to McKinsey’s article, Insurtech: The Threat That Inspires.
By the end of the first quarter in 2019, investment records had already broken new records, and went on to surpass $3 billion, coming second only to the fintech revolution.
While there are still very valid concerns about sharing health data online, the use of such technology can present some useful employee wellness solutions faced by businesses. Considering health-related issues cost US companies more than $260 billion each year, it makes sense that businesses would be eager to support technological innovations that can play a large role in helping to protect and maintain their workforce’s health — and their bottom line.
Policies Personalized To Employee, Company And Industry-Specific Risks
It is no secret that consumers and businesses now want customization. A new report from SmartHQ showed that 72 percent of consumers will only engage in personalized marketing messages, while 88 percent of insurance consumers are demanding more personalization.
For both businesses and consumers, insurtech delivers that, thanks to the employment of artificial intelligence and machine learning that comes with it. Traditional insurance policies are formed using overall industry averages, which are sometimes inaccurate in terms of business size, employee behavior or the health and safety stance of the business.
This means entities including small businesses often find themselves presented with inaccurate constructed and priced insurance policies. The use and continuous monitoring of employee data mean companies can shed unnecessary policy costs and access coverage unique to their organizational needs.
Accenture’s Global Financial Services Consumer study in 2019 showed that 77 percent of customers are willing to provide their usage and behavioral data in exchange for lower premiums and better insurance policy recommendations.
A Streamlined And Simplified Insurance Process
A simpler customer experience means less time and resources are spent on acquiring and renewing insurance policies by businesses. With the use of real data, insurers and platforms are now able to accurately predict employee and business preferences, significantly cutting down on the time taken to include market risks.
As HR departments spend less time and money collecting, collating and analyzing employee data for the insurance process, they can focus on more internal measures of boosting employee health, such as implementing employee fitness initiatives or offering company-wide mental health resources. Underwriting, claims processing and even policy research is significantly changed for the better, leaving more time and space to focus on employees and not legalities.
Continuous Monitoring Means Regularly Updated Tailored Coverage
Another argument supporting the role of insurtech in preserving employee health is that it provides more data that is continuously updated. With health and behavioral information that is regularly refreshed, the decision-making process is also improved, both within the business and on the insurer’s end.
Policies can be updated to reflect changing risks, and more importantly, up to date policy recommendations are fed to management on an ongoing basis, helping them to play a proactive role in maintaining employee health instead of a reactive one. Policies can be auditable, according to Cerity.com which means the final premium paid by businesses is adjusted for any changes over the insurance period, allowing more accurate pricing.