How does insurtech compare with traditional travel insurance?
INSURANCE technology (insurtech) companies are emerging as digital leaders in the travel sector for their innovative products and tailored policies.
The key is to be at the forefront of emerging technology trends, global market demands, elevated customer needs, and engaging collaborative efforts.
Especially in the travel ecosystem, both insurers and customers are waking up to the need for wider coverage options, accessibility to information, and seamless transactions.
As a result, a more conscious effort is being made to personalizing insurance policies and provide individually-tailored customer experiences, while at the same time improving work processes for insurers.
There’s also a move to integrate technology solutions and effectively produce attractive and reliable products, which insurtech companies have consistently been doing.
That is why they trump over traditional travel insurance — they disrupt the industry and offer policies that are more appealing to customers while also changing the operational processes involved.
To meet the needs of extensive coverage solutions, insurtech providers are building artificial intelligence (AI) models that come up with customized, destination- and weather-specific policies.
For instance, customers traveling to ski resorts will be offered coverage tailored to winter sports-related risks. These policies are also customizable as the location of the customer changes, providing them with more relevant add-ons to better secure themselves.
Since insurtech companies collect real-time data to come up with the best, personalized policies based on the location, ongoing journeys are also covered. This includes commute rentals as well as luggage and mobile device protection.
Further, insurtech companies strategically collect real-time data and leverage AI solutions to offer competitive premiums based on specific incidents or risks instead of vague blanket coverage.
Certain progressive insurtech players, for example, provide automated reimbursements for flight delays or cancellations if a policy has been purchased beforehand. This is possible the company has access to data from customers and airlines.
Speaking of which, new-age insurance companies also enhance the business nature of travel insurance by guaranteeing instant claims that are available in the currency and transaction methods of the customers’ choice.
This not only increases the trust level between customers and insurers, but also provides security to customers in unpleasant situations.
The ease of browsing and digital purchasing, among other things, also attracts customers to insurtech.
Insurtech companies still have a long way to go in shifting the dynamics of the travel insurance industry to be completely digital — but they’re already driving the convergence of business models.
The value of traditional insurers will further elevate the industry and drive digital transformation experiences for all key players.