4 great opportunities for insurance companies in times of recession
There are numerous opportunities to increase bottom line and bottom line results through organic growth and improved operational efficiencies, even in a challenging environment such as a recession or economic downturn.
Need for dynamic change in the insurance industry
cyber insurance It is more in demand today. With many customers surveyed by Deloitte Global requesting new policies, more flexible terms, pricing, payment options, and more comprehensive loss control services, the small business insurance industry appears poised for reinvention. However, operators should be careful as the incidence of ransomware increased 235% in 2021 compared to 2019, and average ransom payments increased 370% over the same two-year period.
Improve technological infrastructure
Many carriers thrive off of technological advancement led by InsurTech companies, especially the point solutions provided by enabling startups in customer-facing areas such as underwriting, claims, and online distribution platforms. To increase customer focus, insurers need to start connecting their systems and data while using cloud capabilities. Focusing on micro-improvements while employing business-specific industry cloud applications can be a great next step.
Furthermore, given claims that self-driving technology is still largely experimental, predictions that the emergence of autonomous vehicles would redirect billions in premiums to professional and product liability coverage are likely to materialize soon. This is because the technology and software that controls the car, not the driver, may be to blame for accidents.
However, as more vehicles hit the road, auto insurers should consider creating split coverage, perhaps in the style of hybrid policies already marketed for rideshare drivers, where personal auto coverage applies. when driving for pleasure. At the same time, a different commercial coverage is activated when paid. The same division policies could be promoted when autonomous systems are active and drivers are in control.
Consider ESG as a differentiator
Consider environmental, social and governance (ESG) aspects as a core feature of the business model. ESG issues are increasingly affecting the way all companies do business. Similarly, consider weather risk, where there is growing evidence that P&C insurers will soon need to review their business models. But while many insurers have begun to incorporate weather risk considerations into their investment processes, new product launches and underwriting processes remain unchanged.
Find your new niche
The market for intangible assets, or non-physical possessions with monetary value, is also growing and generating new exposures to hedge. This includes cryptocurrencies and NFTs for virtual activities in the metaverse. According to research by Aon and Ponemon, only 17% of these assets are now insured. So, find your niche for secure crypto it can also benefit future insurance business.
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