Insurtech 2.0: What is the future for the insurance industry?

Insurance technology or insurtech has rapidly transformed over the last few years — spawning technology for every phase of the insurance process, as well as start-ups that changed how policyholders do everything from price and buy insurance coverage to how their claims are filed and paid. It created insurers like Lemonade, Next, Mosaic, CoverHound and Hippo that utilized technology in new ways to offer insurance coverage to policyholders.

The expectation was that insurtech would transform the insurance industry, which wasn’t particularly well known for being on the cutting edge technologically. This would enable carriers to better serve policyholders and make the entire insurance process more transparent.

There were also concerns that insurtech would cost some people their jobs as various services were automated and legacy systems were phased out. Instead, workers have been reskilled and upskilled to better use technology while employing their experience for more complex claims and risks.

Madhu Tadikonda, the newly named CEO of Corvus Insurance, and an insurance industry executive with decades of experience, helps put all of these issues into perspective in the latest Insurance Speak podcast. Tadikonda joined Corvus last year as president and has worked closely with reinsurers, brokers and policyholders to identify and mitigate many of the cyber risks that threaten the online operations of businesses. Previously, he served as the global chief underwriting officer at AIG and also co-founded a risk data platform.

He explains that the early tech entrepreneurs realized the insurance market was disruptable. Much of the process was still paper-based and insurance was largely sold by human brokers and agents, so they went after some of the largest addressable markets like homeowners insurance and small business insurance.

“The business models have changed, and agents and brokers were more enduring than some people imagined initially,” he says, and in response, tech companies pursued markets where solutions were needed.

In the future, Tadikonda expects the pace of change to accelerate and that insurers and coverage will become more proactive when it comes to loss prevention. “Commercial clients have digital assets that have to be protected and we need a new model to protect them,” he explains.

The insurance industry and how it uses technology will continue to change and he believes there will be “a tension between what is stable and what is changing” and cites the example of cyber coverage. “The cyber that you knew five years doesn’t apply today.”

For more on what Tadikonda sees for insurers and insurtechs in the future, listen to the podcast above or subscribe to Insurance Speak on Spotify, Apple Music or Libsyn.

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