How the Insurance Industry Is Changing in 2024
Whether you’re an aspiring insurance agent or already work in the field, it’s good to have your finger on the pulse of trends in the insurance industry.
Insurance industry trends in 2024 are reshaping the insurance landscape more dramatically than ever. Understanding them can help you thrive in an increasingly competitive market.
How is the insurance industry changing in 2024? We’ll explore that below and look at how these changes may affect insurance agents and their customers.
Artificial Intelligence (AI)
Predictive and generative AI are revolutionizing underwriting, claims processing, and customer service by automating routine tasks and providing predictive insights. For example, AI algorithms can analyze huge amounts of data to assess risk more accurately, leading to more tailored insurance products.
Impact on Agents: AI can help streamline workflows, allowing agents to focus on building relationships rather than getting bogged down in administrative tasks. Agents will need to adapt by becoming more tech-savvy and learning how to leverage AI tools to enhance their service offerings.
Impact on Customers: Customers will benefit from faster, more personalized service. AI can provide them with more accurate quotes and quicker claims processing, but there may also be concerns about the impersonal nature of AI-driven interactions. This is where flesh-and-blood insurance agents can step in and provide the human touch customers still expect.
Data Analytics
Data analytics is becoming the backbone of the insurance industry, driving decisions in everything from pricing to marketing. By analyzing customer data, insurance companies can better predict trends, identify fraud, and develop more personalized products.
Impact on Agents: As an agent, you’ll have access to more precise data that can help you target the right customers and offer them the most suitable products.
Impact on Customers: Customers will see more tailored insurance offerings that reflect their individual needs and behaviors. However, they may also face higher premiums if analytics show they fall into higher-risk categories.
Instant Payments
Instant payment systems like Stripe are changing the way insurance claims are paid out. Customers no longer need to wait days or weeks for a check. Instant payments mean that funds can be transferred almost immediately upon claim approval.
Impact on Agents: For agents, this could mean increased customer satisfaction and retention, as faster payouts are a significant pain point for many clients.
Impact on Customers: Receiving instant payouts can be especially helpful in times of crisis, such as after a natural disaster. The challenge for agents is ensuring customers understand the process and trust the instant payment system.
Internet of Things (IoT)
IoT devices, such as smart home systems, vehicle sensors, and wearable health monitors, are providing insurers with real-time data that can be used to assess risk more accurately and offer discounts for clients who take preventive measures, like using home alarm systems, driving safely, or exercising regularly.
Impact on Agents: Agents can benefit from working with insurance carriers that offer discounts for customers who use IoT devices.
Impact on Customers: IoT can help reduce premiums for customers who use devices that reduce risk, such as smart smoke detectors or fitness trackers.
Smart Contracts
Smart contracts, enabled by blockchain technology, allow insurance policies to be automatically issued and claims to be paid out when certain predefined conditions are met. This can streamline the claims process and reduce the need for go-betweens, like bankers and attorneys.
Impact on Agents: Smart contracts can increase efficiency but may be a threat to traditional roles within the industry. Insurance agents should stay on top of the trends and consider training for advisory and consultative services as the transactional side of insurance becomes more automated.
Impact on Customers: For customers, smart contracts offer transparency and speed. However, they may also find the process less personal, and they may need to be educated on how smart contracts work.
Embedded Insurance
Embedded insurance involves integrating insurance offerings directly into the purchase process of other products, such as buying travel insurance while booking a flight or a vacation. This makes purchasing insurance seamless and often more convenient for the customer.
Impact on Agents: This trend could potentially reduce the number of policies you sell directly, as customers opt for the convenience of embedded options. To stay relevant, you may need to specialize in more complex products or offer value-added services that embedded insurance can’t provide.
Impact on Customers: Embedded insurance is convenient for customers at the point of sale. However, they might miss out on the personalized advice that you, as an agent, provide, which can be crucial for more complex insurance needs.
Study for the Insurance Licensing Exam with America’s Professor
There’s never been a more exciting time to become a licensed insurance agent. Even as certain roles and duties change with the integration of artificial intelligence, the insurance landscape looks promising for agents. The Bureau of Labor Statistics (BLS) estimates that jobs for insurance agents will grow by 8% (faster than average) from 2022-2032.
America’s Professor offers comprehensive online insurance courses to help you prepare for your state licensing exam. Our professor uses fun stories and real-life examples to make sense of challenging concepts and tricky insurance jargon.
When you sign up for a course with America’s Professor, you’ll get instant access to comprehensive online lectures taught by our award-winning professor, plus a hard copy textbook. And it’s all backed by our outstanding customer service. Find your course and enroll today!