How IoT and 5G Connectivity Are Transforming Insurtech

Chris Gill, Director of Risk and Insurance Markets for Over-C, talks about emerging technologies and how IoT and 5G are transforming insurtech. Chris Gill is Director of Risk and Insurance Markets at UK-based insurtech Over-C, specializing in data sources and analytics solutions. He is passionate about data, analytics and IoT connected technologies, and these technologies appear to be changing the way we understand and manage risk, particularly in the insurance industry. He is also the former Head of Risk Solutions at QBE, specializing in digital transformation, connected risk management and IOT software for digital partnerships. Let's hear from Chris Gill how much the IoT and more connectivity will change insurtech in the near future. 

How much do IoT devices affect the events in the insurtech sector, and in which areas has the increase been seen the most?

- IoT is certainly nothing new, although it has been around in one form or another since the 1980s. We are now at a time when almost all industries are using IoT to some degree, with connected smart environments capturing massive amounts of real-time data. Despite the obvious benefits of real-time data in insurance, especially commercial Accident and Property insurance, it still relies heavily on static risk factors when selecting and pricing insurance policies. There is now a wave of excitement in the global insurance market about the possibilities offered by the IoT and customer dynamic risk data, but overall uptake has been slow. 

What are the biggest challenges insurtechs face in managing the data they collect and why?

- I would say that the biggest challenge facing the insurance industry when it comes to digitalization in general is the lack of a technology-driven talent pool. Recently, some of the biggest insurers have been looking into the tech industry to recruit innovators to help modernize systems and processes for the digital age, but there isn't a ready pool of Insurtech professionals per se. It is critical that the insurance world change its culture to become more digitally informed to take advantage of the right use of IoT. 

What effect will 5G, which has become a mainstream service, have on insurtechs? Will they end up with more data than they can process?

- The infrastructure for data collection and analysis is actually already there, and 5G really serves to improve existing data processes rather than transform them. The insurance industry should focus on improving the fundamentals of data operations by improving areas like data governance rather than relying on shiny new things like 5G. Bottom line: 5G will be a nice boost for digital operations in the insurance industry, but the industry can't fool itself that it doesn't have much to do with core data processes before reaping the benefits of 5G.

From a security standpoint, what should insurtechs do to protect themselves and their customers from this increased device use?

- With more connections there is always more risk. In the insurance industry, which is slow in transitioning to the digital world, this risk will be very different from the risk faced before, so it is imperative that insurance companies do their due diligence when looking for a technology partner. they follow the minimum security standards expected of a modern, digitally enabled business.

What does Insuretech's future look like regarding IOT, and what are the trends we will watch in the next 12 months?

- From collecting dynamic risk data and ultimately developing a deeper understanding of their customers' risk quality, there are some great opportunities for the commercial insurance industry if they can effectively connect and harness the power of their customers' IoT. Customers adopting IoT have experienced significant improvements in ESG, risk mitigation, and assertions defensibility. In terms of trends to watch out for, I think we will soon start to see many more insurers monitoring dynamic risk factors, enabling them to more accurately select and price their commercial Accident and Property policies for customers, and to offer more focused added value.