FORECAST 2023: Technology Trends
On the technology front, we asked the executives who participated in the annual MarketFacts forecast survey what technology holds the most promise for the insurance and financial services industry. Not surprisingly, many leaders pointed to artificial intelligence (AI) and digitalization, which have the potential to increase revenue, reduce risk, and improve efficiency.
“AI is impacting all industries, and its impact will accelerate in the next few years for life insurance and annuity carriers, affecting underwriting, customer experience, and lead generation in particular,” says Chris Blunt, President & CEO, Fidelity & Guaranty Life. Michael Simonds, Chief Operating Officer, Unum Group agrees: “Leveraging these technologies will positively impact customer service, marketing, and underwriting, ultimately creating more value for policyholders.”
Gordon Watson, Chief Executive Officer, AXA Asia & Africa, notes his company is making progress with AI. “The potential is tremendous, from efficiency improvements to stimulating innovations, but we are mindful of data privacy considerations and are proceeding cautiously.”
“Continued AI improvements will allow technology to replicate certain human tasks, leading to significant cost reductions for servicing and improved cycle times,” says Wade Harrison, EVP & Chief Retail Officer, Protective Life. “At the same time, the human touch will continue to be very important in certain situations. AI can free up talent for higher-level tasks that require emotional intelligence.”
Digitalization continues to hold a lot of promise for the industry, according to survey participants. “Digital tech is already transforming the industry across all aspects, from lead generation to sales via a device, auto underwriting, servicing, and claims payments,” says Watson.
“Digital self-service platforms have great potential,” says Bennett. “So do platforms that integrate across the entire employee experience, using data to offer insights into coverage needs, adjudicating a claim with limited information from the employee.”
John Cai, General Manager & CEO, China Pacific Life, concurs: “Digitalization has changed not only the way of recruiting and training the agency force, but also the way of contacting and serving their customers in recent years.”
The need for an end-to-end (E2E) customer journey was also on the mind of many executives. “E2E digital technology is necessary for the life insurance industry,” says Joe Monk, SVP, Financial Services, State Farm. “Within our organization, we’ve been investing in a new digital administrative platform to better enhance our processes, lower costs, and make the user experience more intuitive with self-service capabilities. We must improve all aspects of the process, including education, quoting, application, underwriting, service, and claims. New digital technology, along with better predictive analytics capabilities, can enhance not only the customer experience, but in our case, our State Farm agent experience as well.”
Some executives mentioned the technology initiatives and advancements their companies have made recently. “We continue to be excited about our proprietary new business platform, Horizon, which has increased speed and greatly simplified the application process for clients and distribution partners,” says Mark Holweger, President & CEO, Legal & General America. “With the ability to integrate with a variety of tools that our partners expect, and new releases every other week, we’re happy to be a few more miles into the marathon of change than many others. And we don’t plan on slowing down any time soon, since there are so many individuals, families, and businesses that can benefit from the end-to-end digitalized process.”
Brooks Tingle, President & CEO, John Hancock Insurance, believes early detection technologies hold a lot of promise for the industry. “The CDC recently announced that U.S. life expectancy has dropped for the second year in a row,” he says. “I think the biggest impact that technology can have on our industry is by improving the health of our customers. For example, this year, we announced that John Hancock will make GRAIL’s multi-cancer early detection test Galleri® available to customers. Breakthrough technology like the Galleri test has the potential to make a real and lasting impact that extends far beyond our industry. Only five types of cancer have recommended routine screenings — breast, cervical, colon, lung, and prostate cancers. Yet, 70 percent of cancer deaths are caused by cancers that are not commonly screened for. We know that survival rates are higher when cancer is caught at earlier stages.”
Several executives were quick to point out that no single technology holds the key to success. “I don’t think it’s a specific technology that’s going to help companies win,” says Amy Friedrich, President, US Insurance Solutions, Principal Financial Group. “It’s about how they use technology to create experiences and solve problems. We are continuously investing in technology, with a focus on how we can effectively use it to better serve our customers. We’re using it to create simple, seamless, and relevant experiences that marry technology and human interaction.”
“The intersection of data and technology is key, not technology on its own,” says Neil Sprackling, President, US Life & Health, SwissRe America Holding. “Respecting the need for, and importance of, data regulation and privacy, the industry has a terrific opportunity to embrace new sources of personalized data, to put more insurance in the hands of Americans. An example from Swiss Re is our strategic partnership with Palantir, which has super-charged our data analytics capability.”