The insurance technology sector is witnessing a massive transformation with the adoption of technology. Those companies who understand and embrace the latest technologies always deliver higher customer engagement and take the customer connection to the next level. By using mobile to relying on social media and using technology to using the cloud, making decisions, deepening customer connections, and pursuing profitable innovations has become easy for the insurer.

Digital is slowly getting imbibed in the veins of the customers, which is indirectly shaping their digital experience. Those insurance companies that cope up with the challenges are capable of cutting costs, improving profitability, and helps in building customer loyalty.

Here are a few changes that have created a landmark change in the insurance sector and are urging other companies to come up with innovative ideas to provide instant gratification to digital customers.

Peer-to-Peer Insurance Model of Lemonade

P2P insurance is slowly gaining traction and is creating seismic ripples in the world of insurance. In 2015, Lemonade became the first company in the U.S to operate as an insurance carrier. The insurance model creates a small group of policyholders that pay a fixed amount of premium and the money is equally refunded at the end of each year if no claim is made. It allows participants to share the risk of any damage or accident along with other people. P2P insurance is changing the entire landscape and disrupting traditional insurance by mitigating conflicts between the insurance company and policyholders at the time of a claim. Startup companies like Lemonade promise a powerful, pleasant, and game-changing experience for both the insurers and the policyholders.

Digital insurance is definitely reshaping the entire landscape of insurance.

Social Insurance like Friendsurance

In 2010, Friendsurance was created with a mindset to make insurance less expensive by reducing the number of premiums each year. In this type of insurance, users are rewarded with a cashback at the end of every year they do not make a claim. The company is utilizing digital innovation and tapping into the market in an extremely innovative way. According to a survey, 90% of customers who used Friendsurance in 2013 received a portion of their premium as cashback. This revolutionizing startup model is helping thousands of customers buy cheaper and affordable insurance.

Drones as Aerial Assessors

Drones are slowly piquing the interest of insurance companies as they improve the overall functionality of the business improving underwriting and claim management. With drones, the insurance company gets access to isolated areas where human intervention is difficult. It helps in assessing loss through imagery analytics and collects aerial data, which enhances precision and accelerates the response time. Drones also come in handy as they accurately predict the risks and helps the insurance company make an informed decision.

A variety of breakthrough technologies are helping in spurring the fundamentals of digital insurance. Undoubtedly, the changing technology is enabling the traditional insurers to cope up and reinvent themselves, it also urges them to respond to the competition. P2P insurance, social insurance, and drones are definitely making their way in the insurance sector.