Technology and data: Focus on the good we can do

11 May 2017 —
Technology and data: Focus on the good we can do
Technology. The press is covering it, everyone is talking about it and we, as an industry, are spending time and money investing in it. For all this reasons and more, we will shortly talk about this topic at our Swiss Re L&H Conference in Warsaw in May: "Think tomorrow! Innovative solutions for our industry."

Some point to the dotcom era and argue that much of this is just another hype-fuelled failure in waiting, while others are much more positive about the potential of technology to transform our industry. I'm in the second camp. And I believe the potential isn't simply tied to the possibilities of smoother, more efficient ways to do old processes - the real potential lies in the increased power we have to help society. Advances in technology and data bring new opportunity for insurers to "do good" - and this is where we need to keep our focus if we are going to thrive in the coming age.

We live in an age of instant gratification - wifi when we want it, a ride where we need it, the perfect song when we feel like it. Even so, let's face it -- insurance still isn't at the top of everyone's "must buy" list. This is particularly true in Life and Health. Advances in technology and data alone won't persuade people to change their fundamental view - or disregard -- of their need for insurance.

Yes, we can make it easy to buy and faster to transact - and these things will make a positive difference for those who fall out of the pipeline once they've decided to buy. But there's more we can and should do.

Lower premiums can't be the end game

Our growing access to new sources of data will also open new windows to understand risk and create new and different ways to underwrite it that are easier for the consumer.

In the Life & Health space there's a lot of current focus around lower-hanging fruit such as wearable devices that help the fit get fitter and the healthy get healthier. There's nothing wrong with rewarding healthy people with lower premiums, but how useful this is in our quest to get more people to buy insurance? Using technology to make cover cheaper can't be the end game. I'm hopeful that the next stage of development will focus on how we can expand the pool, how we can extend our blanket of protection and increase the numbers of people we secure with valuable and appropriate cover.

More information = more access to insurance

A great example is tackling an underwriting challenge like diabetes. We're already exploring how to use wearable sensors and other technology to help people better manage their diabetes, improve their condition and enjoy a healthier lifestyle - all of which leads to a more open and lower cost insurance cover. Even better, it could help us to accept more diabetics into the risk pool. For me, that is good news and a great example of how we can use new technology and data to do good.

The same is happening in the motor industry with telematics and ultimately, the autonomous vehicle. Some bemoan these trends as the risks reduce and the premium pool shrinks, however, I see it as just the opposite - more people will be able to afford cover and we'll have fewer uninsured vehicles with fewer accidents and deaths which is better for everyone.

This focus on "doing good" must be the mantra for the wider insurance sector. Without it, issues of data access and privacy concerns will soon have us mired in regulatory issues, consumer rejection and complaints and quickly undermine our very ability to do the good we intend. Our potential to make a real difference would be lost.

Let's embrace the "doing good" aspects of technology that allow us to make insurance easier to buy, faster to transact and most importantly, able to meet the needs of many, many more customers.

Michael Haas, Head Life & Health Austria & CEE, Swiss Re