How the Internet of Things is reshaping the Insurance Industry?
- Published by Elena Ostapchenko
The emerging Internet of Things is speeding us up to a new connected economy! This is where billions of sensors are being attached to production lines, the electrical gadgets, logistics networks, installed in homes, offices, stores, vehicles, and even humans, feeding Big Data into an Internet of Things (IoT), the global intelligence network.
Let’s have a quick look at what is happening now in the health insurance. Take a new Pulse, for example, which was introduced to the market about a year ago. The biggest insurance company AXA has teamed up with Withings a leader of smart devices production to develop a product as a service bundle. The Pulse can be worn as a watch which tracks how much physical exercise is done in a day, measures your speed, heart rate, blood oxygen level and the quality of your sleep. It includes a complimentary cloud service where data is stored and also an app which lets you visualise and track your well-being and share it with others.
Wait for the “cherry on top”
Based on the incoming data, AXA adjusts its service offerings and refunds its customers based on their level of activeness.
Have you seen a fork which connects to the Internet and checks how much proteins, carbs and fibers you have eaten in a day or a toothbrush which measures how long you have brushed your teeth, checks your teeth and brushing method as well as verifies your dental health plan? This is a fiction episode from the Star Trek? No, this is already happening.
Turning to the car insurance business, the Desjardins Group as well as Mobiliz from Québec are pioneering the industry. Both companies independently launched a program which rewards good driving behavior with a significant discount. A smart sensor in your car monitors and analyses your mileage, acceleration, breaking, travel times and etc. The companies offer a black box insurance and PAYD/PHYD/MHYD (Pay As You Drive / Pay How You Drive / Manage How You Drive) business models which is a win-win for both parties: the customer and the insurance-provider.
What about the Google Driverless Car? Looks like it is alive and kicking and has finished 700 000 miles driving on its own so far without causing a single accident. It is far from being 100% perfect but the day when we can turn on an autopilot in a car is just around the corner. Its founders predict that this will happen in about 5 years. In the very near future every car will become a smart car.
It can spot mechanical problems and potential accidents before they happen, analyse and help improvement of a driving pattern. A smart car can produce several GBs of data in a second. It will become an intensive data consumer as well as a massive data generator.
Now let’s make a quick calculation.
Imagine when everyone out of 6 billion users on this planet will have at least 10 smart products and devices.
What does this mean for your business?
The upcoming Challenges for Insurance Industry
In the economy where everything is connected in the Cloud, companies will be able to have a high visibility (if well equipped) into all the factors which impact their businesses: e.g. their suppliers, customers, competitors, market conditions, social media footprint, and etc. This economy introduces a lot of business opportunities and challenges to come.
How to stay on top of the game? How to harvest numerous business opportunities and make use of TBs, PBs…YBs of incoming data?
You can't make cookies when you haven't got the dough.
The Internet of Things (IoT) opens new opportunities and great challenges of Big Data. Are you prepared to tackle the volume?
The success doesn’t bow to us, we must rise up to it.
The good news is that there is still time to prepare and be on top of that upcoming wave of data but, with all that noise, the task won’t be easy. To succeed, business users will need to find a niche opportunity by combining all that information and, IT users will need to have the right tools and effectiveness to support all that incoming data. The key here is to be aligned on a common goal and being able to get that information in a timely matter.
To wrap up, let me quote a 1989 NYC Marathon winner, Juma Ikanhaa:
"The will to win means nothing if you haven't the will to prepare."
We are at the start line of the new connected economy. Let’s prepare. Let’s be ready to win.
Interested in receiving the latest news about analytics and Big Data? Provide us with your email to receive the blog articles of our experts.