The P&C insurance industry is about to be turned on its ear by the Internet of Things (IoT). For P&C insurers already facing growth and profitability issues, long-term signs are pointing to accelerated change and new challenges that will require new strategies to address changing customer behavior and view of risk.

The IoT is a web of smart inter-connected devices, people, and organizations that is a wild west of opportunity and innovation, with 30 billion devices impacting 6% of global economy by 2025. The greatest impact will be disruption through redistribution of $3 trillion in revenues, thus creating winners and losers. Within the next decade, IoT will be pervasive, with billions of connected "things" driving a data explosion with sensors embedded in cars, buildings, and wearable devices—so much so that a family of four could have more than 100 connected devices.

This IoT data will further accelerate today's fast-changing consumer expectations by enabling consumers to access a wealth of relevant, real-time information regarding themselves, their physical assets, and associated risks. For example, advanced driver assistance systems (ADAS) can already take control of a vehicle to avoid a crash. In the home, sensors or devices are able to notify homeowners about unusual activity. The IoT will fundamentally change what consumers know, when they know it, and how they interact with businesses that serve them. It will change the consumer dialogue about risk, and shrink consumers' perceptions of the boundaries of "traditional, insurable" risk.