* By Claudio Endo
The insurance sector was also impacted by the paradigm shift that the pandemic brought to the world in 2020. If, on the one hand, this market suffered a drop in demand for business, life insurance and automobile policies due to the economic upheaval suffered by people physical and legal since March, other opportunities have pointed out on the horizon!
One of them is the need to ensure the financial health of companies with the advent of stricter laws related to data protection, such as the LGPD, and cyber threats with the acceleration of Digital Transformation. A trend that promises to intensify as of 2021: offering companies this type of insurance is an interesting alternative for organizations.
To continue in this game, taking advantage of the new opportunities that the post-pandemic world indicates, insurance companies have been driven to migrate to digital more urgently. We see, for example, banks investing in digital platforms and using Artificial Intelligence to streamline the hiring of services, validation of coverage, make price decisions and / or deliver services of this line to consumers.
This trend continues in 2021, as the sector is also being impacted by the arrival of startups - or insurtechs. They drive traditional companies to invest in technology and take advantage of the digital environment. It is important that these companies continue investing in technology and innovation to remain competitive, since the insurance consumer has in hand search mechanisms for the best price and service options, coming from a greater digital maturity, and less bureaucracy.
Digitally transforming means being able to offer good alternatives and more accessible benefits, and this is fundamental in the new world accelerated by the pandemic. Let's think about this scenario: who wants to leave the house to do an inspection? It is possible to streamline procedures, with personalized service, using applications. Following this trend improves the customer experience, with agility and efficiency.
Challenges
In the insurance sector, LGPD has another side, in addition to being a new business opportunity. As well as companies in sectors such as telecommunications and logistics, this also needs to comply with the rules of the General Data Protection Law and, because it has a chain of suppliers that interconnect to serve insurance clients, it must be very attentive to data management. and compliance both within its facilities and those of third parties.
These companies keep a lot of sensitive data - address, documents, lifestyle, history of experiences, how to use the car, etc. These are data used to make decisions, but now it will be necessary for them to act both on the contractual and legal side, as well as on the systems side for their clients to authorize the use. At this time, it is essential to combine digitalization, digital transformation, cybersecurity and care for privacy. The financial damages, in case of irregularities and denunciations, are great. The stain on the brand image, even bigger.
To be up to date with the whole technology package without having to assemble large teams and have huge expenses with equipment and constant updates, it is crucial to support consultancies with experience in this journey, who give the best directions in the adoption of technology with agility and who do a transition from legacy to digital without trauma.
This partner is also indispensable when we think about data protection and cybersecurity, since it performs all the analysis of threats, identifies where they come from, validates possible loopholes and helps the client to anticipate and protect themselves, in addition to performing privacy management of data. In other words, a range of services so that the insurance company can make a mature journey to digital, safely, and have data protected.
The best consulting option is the one that uses the XaaS methodology, or “Everything as a Service”. Even the most reticent with this model had a paradigm shift in 2020, as they saw the need to be in cloud environments (and the key component for this migration is “as a service”). In this regard, XaaS meets needs quickly, as it promotes high scalability and increases the ability to absorb unexpected demand in a much more agile way.
At this point I want to leave a message: with the advent of Techs, the move to the cloud is a path that has no return. Those who do not adapt will not survive in the medium term.
Future
Making a prediction based on what we live in today, this market will be well impacted by digital.
However, it is important to understand that the competition in the future will not be just niche. What will guide the future is “as a service”. The trend, for example, is that a car is no longer a good, but a service. So, companies in other segments can offer insurance as a “plus” in the service provided, just as insurance companies can couple consumer goods in the offer.
In the future, the concepts of verticals will be replaced by the concept of “as a service” and the competition will be horizontal. Everyone can diversify. This is a great opportunity for those looking to differentiate themselves and not get used to it.
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