The data age of insurance is here: USAA analytics leader

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The insurance industry is entering the “data age,” a time where carriers must compete on insights obtained from consumer information, not just the convenience of services provided through digital apps, according to Patrick Kelly, AVP of emerging technologies at USAA.

In this era, virtual assistants, augmented reality, autonomous vehicles, machine learning and the pending 5G mobile network reign supreme, Kelly told a room of industry peers during his day three keynote address at Digital Insurance’s Dig | In the Digital Future of Insurance conference in Austin, Texas. The previous "connected age" commenced after Apple’s launch of the iPhone in 2007 and was defined by offering online interactions on the insurers' terms. Now, carriers can leverage advanced data and analytics to provide customers an experience that they seek.

“Data is our coal—the raw material we use to create the products customers demand from us,” Kelly explained. “Features on a mobile app or website are not our competitive advantage anymore.”

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The influx of data available today also requires insurers to engage with customers where they are to provide aforementioned insights. The sleeper technology in the data age—5G—will make this faster than ever before, Kelly noted. 5G is rumored to be 250 times faster than its predecessor, 4G, with an average download speed of 1.2 gigabytes per second.

“You can download the new ‘Avengers’ movie in two seconds,” he joked. “And also transmit data from drones or connected cars at speeds never seen before.”

Emerging technologies will prove critical in future engagement with policyholders, Kelly continued. Being able to communicate with policyholders through virtual assistants or by embedding new products into the apps they use most frequently will allow carriers to interact with customers on their terms, and in their language.

This strategy removes friction in engagement at a time where policy discounts are not enough to receive millennials’ permission to use their data, Kelly says. Rather than of providing usage-based insurance or smart-home discounts in return for behavioral data, a better use case for sensor technologies is alerting insurers when their tires need replacing or a water heater is about to result in a very costly claim, he suggests.

On the virtual reality front, carriers can use 360 degree cameras in the field to transmit video back to call centers, resulting in agents getting a better understanding of what customers are facing. Augmented reality could also prove pivotal in training claims adjusters.

“Training adjusters with cheap $200 headsets is much faster than flying them in, housing and training them in a classroom before sending them into the wild,” he concluded. “Evolution never stops. It’s not the smartest or the strongest that will survive. It’s the one that best adapts to change.”

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Customer-centricity Customer experience Internet of things Augmented reality Virtual assistants Claims Usage-based insurance Smartphones Connected home USAA