Technology has found its place in homes, offices, stores, and schools. Not to mention, consumers use tech daily via smartphones, tablets, and smartwatches to access the web, message/call others, and more. Of course, technology is also advancing various industries. For example, many auto insurance companies use tech to help set rates, and there are also apps to file claims, pay bills, and make coverage adjustments, all from a smartphone, computer, or another electronic device.
Potential clients can access the websites of their insurance companies to pay their premiums or make policy changes. Another reason why auto insurers have turned to technology over the years is to monitor or track driving habits.
Customized Insurance Plans
Auto insurance companies send customers devices that plug into diagnostic ports under their dashboards. The way a tool looks will vary, but it should be relatively small. For example, Progressive’s Snapshot device is palm-sized. It records how far you drive, how you drive, and when you drive. Then, that data is sent back to the company via a cellular network to determine your discount. If you’re considering signing up with Progressive because of this discount offer, take the time to go through Progressive insurance reviews.
By reading the testimonials of previous clients, you’ll gain an understanding of what Progressive offers. Or have you heard of Allstate? It is another top auto insurer with a program similar to Snapshot, named Drivewise. With Drivewise, the company measures driving behaviors and rewards policyholders who are safe drivers. So, one reason why insurers use technology to set rates is that it allows motorists to determine their own fates. The safer a person drives, the more that person can save.
Calculate Accurate Insurance Premiums
Technology allows auto insurance companies to be smart and strategic. As such, car insurers collect data and use it to determine how much a person’s premiums will be. Not all businesses use the same algorithms or formulas to perform calculations. By using car insurance calculators, customers get accurate rate quotes as human error is eliminated from the equation.
Cut Back on Expenses
Some insurance companies set rates using technology to cut back on their expenses. By relying more on technology, insurers can reduce the number of people in their workforce. When personnel costs decrease, businesses save money. Then, they can pass along the cost savings to consumers.
Draw in New Clients
Apart from using technology to set premiums, auto insurance companies use tech tools and platforms for advertising and getting the attention of new clients. Digital technology, social media marketing, and other advertisements grab the interest of people. They draw customers in and keep them engaged.
Benefits of Insurtech
In layman’s terms, insurtech or insurance technology consists of constantly changing technologies used to streamline and enhance insurers’ processes. Not only that, but insurtech also improves the customer experience and saves insurers money. Insurtech is a relatively new concept and is a subdivision under fintech. Insurtech comes in different forms, but some of the most common categories include:
- Artificial intelligence
- Machine learning
- Internet of things
- Smartphone apps
In addition to those technologies, State Farm and other insurance companies are using drones to inspect rooftops and other places for dangerous conditions. This keeps workers safe and out of harm’s way. Plus, drones can save insurers money. Then, those savings can get passed on to policyholders.
More Than Figuring Rates
As you can see, there are many reasons why insurers use technology to figure rates, but that isn’t the only way tech is used within the industry. For example, when people visit insurance websites and initiate chats, they often interact with chatbots. These chatbots walk clients through various tasks, answer questions, and direct visitors to appropriate departments.
Chatbots help insurers save money, as they don’t have to be paid and are available 24/7. A workforce consisting of AI with machine learning will work holidays without complaining. Then, insurers can pass on the savings to consumers and improve the customer service experience. Some estimates point towards 95 percent of all customer interactions being chatbot-powered by 2025.
So, you could get on a chat with an insurance chatbot now. However, if your insurer isn’t already using a bot, it could only be a matter of time it heads in that direction. One particular virtual assistant is GEICO’s “Kate.” The helper communicates with customers via voice or chat. It also assists with policy inquiries and coverage questions.
Auto insurance companies are using technology in many ways today. Some insurers send people devices to collect data and track their driving habits. As for other insurance providers, they have apps that gather information before sending discount offers to people.
Of course, there are also technology options that don’t revolve around setting insurance premiums. Instead, things like chatbots focus on customer service. They help clients in a variety of different ways, often eliminating the need for them to speak with human representatives. Technology continues to evolve, and it is sure to remain an integral part of the auto insurance industry moving forward.