In our earlier post, we had written about how the insurance industry has embraced advanced technologies, starting with IoT and that included connected wearables. It is now time to talk about the pros and cons of these wearables…
Over the last few years, there has been a phenomenal shift in how insurance enterprises have approached sales and business. Similarly, there has also been a tremendous rise in the popularity of wearable technology- tracker devices, smart watches, smart clothing, accessories, sports wear and much more. Therefore, it is no surprise that both the customer and the business owners have understood the value of these and adapted to using them to enhance the customer experience, and boosting business growth.
All said and done, one needs to consider the pros and cons of the connected wearables before jumping into the deep end of the pool.
The Benefits of Wearables
- Real-time data gathering-
The wearables provide unmatched opportunities to collect real-time data that is relevant and reliable. The data is useful in improving business decisions. Infact, life and health insurance companies are leveraging on the wearables and related sensor based devices as they offer accurate information, thereby reducing risk of frauds as well.
- Personalized policy recommendations-
The real-time data gathered from a customer’s wearables, data analytics generated thereon are used to design and personalize insurance products. Based on the risk exposure and the data, insurers can assure the customer they are offered products that suit their preferences and lifestyle patterns.
- Engagement with customers-
Wearables are a boon to the insurance industry, especially the life insurance that has so far been working with limited opportunities offered by the traditional methods. However, with new technology in place, this has given a new lease of life to insurers and allows them to interact and stay connected with their customers regularly — be it for the policy, clarifying queries and agents gain opportunities for cross selling.
- Rewards & discounts-
With wearable devices, insurance enterprises can provide rewards and discounts to their customers. Depending on the risk pattern, data analyzed, the insurance premium amount is calculated. Similarly, the device also gives alerts and notifications to the customer if there is a significant change in their activity.
- Increased productivity amidst insurers-
A research has proved that insurer’s productivity goes up by 10% when the company uses wearable devices. These devices allow the insurer to complete tasks faster and more efficiently. This is in fact true across industries, more so in the insurance space that has been all about paper work and personal touch.
The Drawbacks of Wearables
Brands such as Apple, Samsung, Nike and every other major player have launched their line of wearables — be it gadgets or clothing lines. While the customer is spoilt for choice, the investment is quite high. Similarly, for the insurance company investing in the systems and technology needs to ensure the devices can be connected and can be supported is a point to ponder about.
2. Data accuracy
While Fitbit trackers have a strong battery life, Apple watches don’t. Also, when the charge is low or when connectivity is not strong, the data captured might not be 100% accurate. If the data gathered is inaccurate, it would affect the analytics therefore the policy offered and premium as well [esp for people with heart conditions or serious ailments].
3. Privacy concerns
The data from the wearable devices needs to be kept safe and secure by the insurance company. Customers will become wary if their data is shared, or used for any purpose apart from their own insurance policy related discussions. There needs to be adequate security systems in place to prevent hacking or other fraudulent acts.
4. Obsession with data
Information is always valuable, and when it comes to data from these wearable devices, the customer and insurer stand to win equally. But then, the downside of using these wearables is the customer could get obsessed, constantly monitoring the data, updates, ensuring they are on top of their game. While it sounds like a good thing, it can prove detrimental if their health takes a toll because of working out too much or being too focussed on the device and not driving right, putting the vehicle and their own life at risk.
At Neutrinos, we have been innovating and adopted advanced technologies and that includes working with not just mobile apps, but also RPA, AI, ML, and wearables as well. We enable clients to harness on RPA and BPM solutions to automate time consuming, manual processes and maximize productivity levels.
To stay ahead of the game, and adopt these into your business, talk to our experts today!