Technology growth

The pandemic is driving tech growth in the insurance industry

Technological growth has not always been a priority in the insurance industry. “We’re sometimes a slow industry to adopt things, I dare say,” said Don Griffin, vice president of personal lines for the American Property Casualty Insurance Association.

The industry has adopted catastrophe modeling for predicting the severity of events and for processing claims. Use of the technology was increasing before the pandemic, but it accelerated during quarantines for handling claims, experts say. This modeling gives officers an idea of ​​the extent of damage to a location, said Tom Larsen, director of industry solutions at CoreLogic. “Weather forensic” determines what happened at a specific location rather than half a mile away.

“The influence of [COVID-19] was to accelerate this technology, which was kind of moving like a glacier,” Larsen said. Using catastrophe modeling for claims is better for policyholders because insurers can handle claims more efficiently and at lower cost, getting money out to customers faster, he said. .

Because insurers don’t interact with policyholders often, they can differentiate themselves from other companies by how they respond to customers when needed, Larsen said.

Karen Clark, CEO and co-founder of catastrophe modeling firm Karen Clark & ​​Co., said catastrophe models can be used to project the average severity of claims in the two days before a hurricane landfall. . His company’s data, which insurers use for planning, shows damage by zip code and is updated twice a day. After a disaster, insurers need additional experts, so loss severity planning can help them decide where to place them, she added.