Technology is the foundation of most of the operations carried out in today’s time. It has not only brought about changes in society, but those changes are rapid and continuous. Because technology is such a dynamic thing, it has extended its scope to almost all modern fields of work and sectors.
Technology has also encompassed the insurance industry and made many things accessible. The changes are not very small; they are extreme and very useful. If a policy seeker away from the home country wants to buy a life insurance plan or a term policy, they can opt for term insurance for NRI individuals through the digital medium.
Not just the purchase procedure of life insurance plans, technology is involved even in the functions of policy features. To understand the effect of technology on the life insurance industry, you will need a little more insight into it.
Let us have an in-depth discussion about the same with the help of technology’s positive and negative impact on the industry.
Impact of Technology on the Insurance Industry
Positive Impact
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Access
With the inclusion of technology in the insurance industry, people have increased access to the life insurance policy. First, technology like social media, television, radio, and web applications have increased awareness about life insurance policies.
Because of this, there has been a spread of information in the masses. The spread has also led to an increase in demand, and hence, the supply curve has increased. The financial instrument that was unknowingly restricted in the creamy layer of the nation is no longer in those constraints.
Apart from that, one online search can land an individual an online or phone appointment with the insurance consultant. This is the kind of accessibility the insurance industry deserves, and technology makes it happen.
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Increasing Diversity
Diversity in the types of insurance has been possible because of the increasing use of technological devices. For example, the integration of online transfers at the time of maturity is possible due to online banking technology.
A slew of options available in the market is also a blessing of the technology. This is a result of the increasing competition. Competition and demand push policy providers to innovate and offer different kinds of policies and services.
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Cost of Services
The cost of services has been reduced a lot. Back in the day, companies used to have a lot of paperwork, but online procedures have cut down on that. The appointments with clients and customers have gone online, and that, in turn, has reduced the cost.
With the help of artificial intelligence, the onboarding procedure and claim settlement process have also become very easy and simplified.
Negative Impact
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Lack of Digital Literacy
If someone with a lack of digital knowledge wants to purchase a policy, it becomes difficult for them to buy it online. Even with the digital revolution, there are people who are still away from all of this. This increases the learning curve, and most of the time, they lose the opportunity to safeguard their family.
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Risks of Cyber Threats
The digital revolution has brought many good things, but it is not immune to faults and limitations. Anything that is online requires an extra bit of security. Online threats like data theft, breaches, malware, DDoS attacks, etc., can often overwhelm the company and its customers. Since the data is very personal and sensitive, it becomes a necessity to stay away from these scammers. However, it is very taxing and costly.
Summary
There is a lot of potential in the integration of technology and the life insurance industry. In the end, it is all about how things can get better and easy for the clients. It helps in various things like effective functioning, efficient operations, personalised services, data science, and risk mitigation.
Taking care of things like online safety is in our hands. But apart from that, things are readily available for purchase from the insurance market, and the customers are more than happy to get simplified services.
