The property insurance industry is at the edge of an era of innovation, and there's much more to come in 2019. Before delving into the key trends driving the industry, let's look at how two major factors are making these innovations necessary now. First, the sheer number of property claims is going up. We're facing a future of weather extremes: more droughts and wildfires, more intense hurricane seasons, and stronger storms overall. These weather extremes portend an increase in claims, and it's already happening. Ernst & Young Global Limited reports that 2017 was the largest insured loss year ever. Not only will insurers have to adjust more claims, they'll also have to adjust how they write policies, so they're not caught off-guard by shifting weather patterns. They'll need the tools to deal with the deluge. Second, at the same time that claims are going up, so are customer expectations. Today, insurers are serving a greater percentage of millennials who expect companies to be as tech-savvy as they are. They not only want a good policy, they want the added benefits of convenience, speed, transparency and a level of personalization that customers before them simply didn't demand. In these conditions, carriers are being challenged to do more with less, and they won't be able to keep up by doing things the old way. Fortunately, technology is helping them do things faster and save significant costs. Here's what we expect to see in 2019. |

No. 1: Virtual claims adjusting

As more carriers embrace virtual claims adjusting, they gain a serious competitive advantage: A process that once took weeks can now be resolved almost instantly. Virtual claims adjusting allows insurers to remotely measure losses, estimate damages, and pay customers faster. Today's technology also helps insurers get more — and better — property loss data, all faster than ever before. Now homeowners can easily share smartphone photos of the damage with adjusters, using a service like HOVER to help resolve claims faster. For instance, one Top 10 carrier used HOVER to virtually adjust 40% more wind claims in 2017 vs. 2016, and reduced average cycle time by a full day. These are valuable gains, especially since 87% of customers say that the claims experience influences how likely they are to stay with a carrier. When it comes to claims, speed and transparency are key to customer satisfaction, and virtual adjusting delivers on both fronts. |

No. 2: Innovative use of mobile technology

Carriers are already embracing mobile claims adjusting — a trend speaks to a greater need to serve tech-savvy customers better, faster, and with a higher level of personalization. Carriers are also using mobile to communicate with customers seamlessly, through text and apps. They're letting customers check their policies on the go and make changes in real time, and they're integrating technology, which helps with both underwriting and claims processing. With these improvements, customers who want to file a claim, for example, no longer have to call a representative, go through a bunch of steps, and set up an appointment with an adjuster. Mobile is cutting a lot of that excess, to everyone's benefit. It's also prompting carriers to reimagine how they insure property. We're now in an era of hyper-personalized, on-demand insurance coverage, and companies such as Sure, Trov, and Lemonade are leading the trend with mobile apps that let customers get coverage on the go. Ernst & Young predicts we'll be seeing more dynamic pricing models like these in the future. |

No. 3: Better, more powerful data

The rise of the Internet of Things (IoT), coupled with the ability to gather and store more comprehensive data than ever before, is opening up new possibilities for carriers. In 2019, we'll see more companies using this data in powerful ways, whether it's to better understand customer needs to create more personalized policies or to collect property insights so they can mitigate risk. Today, smart home technology is booming — and it will have significant impacts on the property insurance industry. According to Deloitte, smart home devices are expected to see compound annual growth rates of 60%, which translates to 600 million smart home devices by 2021. The availability of more comprehensive property data from these devices will not only give carriers the power to make wiser business decisions but to mitigate risks before they become claims. It also adds a layer of personalization to the customer experience and gives carriers the possibility to tailor policies based on data-driven insights: in today's world, this level of customization is an expectation, not an exception. |

No. 4: Blockchain will get bigger

Two years ago, carriers were just starting to talk about blockchain technology. In 2019, they'll be moving from talking about it to acting on it. Blockchain securely stores data on decentralized servers, making it simpler for carriers to access it, validate it, and use it to detect fraud. With blockchain, customer or claim details can be referenced against a decentralized data depository — what amounts to a common "record of truth". Blockchain innovations are already in the works: The B3i initiative, an industry consortium, is introducing blockchain for property catastrophe reinsurance and leading insurance firms are piloting "smart contract" insurance policies based on blockchain technology. Innovations like this should help eliminate many of the logjams that riddle the insurance landscape, translating to a more accessible and dependable data infrastructure. Blockchain promises to streamline and simplify many back-of-house operations and give property insurance carriers another way to do a lot more — with a lot less. |

Whats ahead for 2019?

As the pace of technology speeds up, property insurance must evolve to catch up. We've already seen positive change in this direction, with carriers implementing everything from virtual claims adjusting to AI-driven chatbots to help handle customer requests. In 2019, expect to see more carriers embracing opportunities like blockchain and the possibilities that mobile and smart home technology bring. These innovations all have the potential to transform property insurance for the better–and the biggest wins will go to those who adapt first. Kevin Reilley ([email protected]) is executive vice president of business development and corporate strategy at HOVER. These opinions are his own. See also: Where to look for the first insurance blockchain adopters