2022 Trends to Watch for in Insurance

The pandemic seems to have sparked a sense of urgency amongst insurers in the American market. Historically, insurers have been sluggish in adapting to a quickly changing market.?Covid-19 has changed everything. There seems to be an acceleration in the adoption of innovative technologies by insurers. The combination of the pandemic plus changing customer tastes has changed everything for insurance leaders. Below are the trends insurance professionals should be aware of moving into 2022.?

Customer Experience

To stand out from other carriers, insurers will look to hyper-personalize the customer experience and incorporate the customer perspective into their strategies from beginning to end. Improving the customer experience (CX) will be top of mind for insurers in 2022 and beyond.?

Based on conversations I have had with insurance technologists, insurers will strategically slow new business efforts in 2022 to focus on customer experience to increase retention rates. Insurers with an eye for the long term are increasingly prioritizing customer experience to add to the bottom line from existing business.

Increased retention at scale depends upon automation. Key events in the client lifecycle – onboarding, renewal, ongoing cultivation cross-sales – require relevant communications at the right time. Also measuring customer satisfaction is important. This gives insurers opportunities to ask satisfied current clients for referrals and reach out to dissatisfied clients to address improvements that can be made.

Insurers like Lemonade and The Root showed the power and value of putting an emphasis on customer experience. Insurers who do not adopt this philosophy will be left behind.

Environmental Impact

Environmental, social, and governance (ESG) efforts will be a focus for insurers in 2022. The COVID-19 pandemic, the tangible effects of climate change, and the emergence of more environmentally responsible consumers have forced insurers to be more . As a result, we’ll likely see insurance companies highlight their ESG efforts in 2022.?

Insurers need to get their ESG-related data into one central repository. Insurers often rely on multiple systems to house this data and manage their business. A key challenge the insurance industry faces is quickly adapting to changing ESG requirements, which means gaining visibility into all ESG data elements across the enterprise and validating them against a list of evolving ESG criteria and attributes. Insurance companies will likely adopt technology such as a low-code platform to assist in ESG efforts.?

Talent Crunch for Insurers

Finding and retaining the right talent in an extremely competitive job market will be one of the biggest insurer challenges. Roles requiring technology skills top the talent crunch list: cloud engineering, data science, AI, software development and cybersecurity.?Insurers will need a multi-faceted approach that addresses reskilling, work-life balance, the looming effects of COVID-19, and the needs of a remote work force.

Agent Experience

Independent agents are valuable for insurers into 2022 and beyond. To drive large-scale growth, insurers will need to incorporate the agent experience into their digital strategies, enabling digital interactions across agency workflows and ensuring that it truly is easier for agents to place business with them. It will be important to stay in touch with what the new brand of agents requires to continue to grow this channel of business.?

Enterprise Risk Management

Enterprise Risk Management is a critical focus for 2022. Carriers will need to continue to expand their ERM capabilities to detect, prevent, respond, and mitigate risk. Opportunities will arise for carriers who develop strong ERM strategies and use platforms to execute said strategies.

Predictive Analytics and AI in Insurance

Data is an extremely valuable organizational asset for carriers across the entire insurance value chain. The volume and quality of available data employing advanced AI will increasingly help insurers better underwrite, price, and manage risk with increased speed.

Above are the top trends that I predict will be a focus moving into 2022. Are there any trends that I am missing? If so, comment below. Any additional feedback is much appreciated. Below are a couple of videos from other experts highlighting trends to look out for in 2022. If you have any questions, please do not hesitate to reach out and message me directly.

“Four Ways Insurance Companies Are Improving Their Customer Experience.” Smarter Business Review, 18 May 2021, https://www.ibm.com/blogs/services/2021/05/18/four-ways-insurance-companies-are-improving-their-customer-experience/.

12 Insurance Industry Trends for 2022. https://www.oneinc.com/resources/blog/12-insurance-industry-trends-for-2022. Accessed 23 Feb. 2022.