Technology is changing the insurance business: Are you ready for it?

Commercial insurance brokers are facing the ‘Amazon effect,’ with customers demanding faster speeds and price comparisons. While getting up to speed with technology requires time, resources, and new skill sets, particularly for medium-sized brokerages, technology itself can open new doors.

From customer data to claims data to underwriting data, insurance is a data-rich industry. That data can become a competitive differentiator, presenting opportunities to fundamentally drive a better customer experience. When advice is grounded in facts, it’s more credible—and that leads to higher trust. This allows brokers to become a ‘risk partner’ to business owners and managers.

Technology can help brokers become more productive, increase their sophistication, and bring more value to their customers. While brokers are already using technology, there are new capabilities available that can fundamentally improve the customer experience. Although technology addresses speed and efficiency, the human element is irreplaceable, including understanding and addressing specific client needs. Underwriters play a crucial role in building trust and providing tailored solutions.

“Technology will play a big role in the future of commercial insurance in Canada. It will help us with data analysis, such as pricing, as well as increasing speed to market and portfolio management.”
—Anna McCrindell, Wawanesa’s SVP & COO – East

Artificial intelligence

Artificial intelligence—and, in particular, generative AI (GenAI)—are at the top of the hype cycle right now. And applications for AI in the insurance industry are seemingly endless. For example, AI can be used to speed up the settlement process.

AI can also be used directly by brokers. “If a broker is dealing with 50 insurance carriers, they can use AI tools and techniques to quickly find out the top five carriers for a particular insurance product, rather than looking through manuals. That technology is already being used to help them with their day-to-day tasks,” said Susan Williams-Bonet, VP, Ontario Region, with Wawanesa. “That’s going to boost speed and efficiency.”

But the responsible use of AI requires careful consideration of potential biases, ethical considerations, and transparency in decision-making. For example, bias within an AI system can produce results that propagate further bias. That’s why brokers and insurers will need to work hand-in-hand with AI solutions to modify AI decisions, if required. Responsible use of AI should be part of upfront process design and not reactive after a process has been augmented through the use of AI.

Automation

Technology can help insurers and brokers automate manual processes to drive productivity, ultimately helping to build a stronger connection with their clients. According to analysis by Deloitte, insurers can accelerate underwriting transformation “by automating routine tasks and augmenting teams with emerging technologies and alternative data sources to empower underwriting professionals.”

Automating the claims process benefits both brokers and their clients. Insurers and brokers can use their time for work that requires emotional intelligence, while AI solutions can be used for more tedious, time-consuming tasks—or tasks that could be done more efficiently by AI. Self-service options can also boost efficiencies by allowing clients to handle simple requests on their own.

Data analytics

Underwriting is all about data—or, more specifically, how to interpret data. By applying data analytics techniques (which include the use of AI and machine learning), brokers can combine their personal experience and skill sets with new tools and approaches to slice and dice data, pull out key insights, and share those insights with their clients—even creating customized risk profiles.

While data analytics and AI provide valuable tools for interpreting data and generating insights, the integration of personal experience and expertise of human underwriters is essential. Human judgment is crucial in understanding the context and nuances behind the data, ensuring accurate and ethical decision-making.

Analytics solutions can also incorporate predictive modelling to enhance risk assessments, optimize pricing, and even detect fraud by searching for patterns and anomalies in the data. Brokers can use this information to predict customer purchase intent and proactively offer the right product at the right time—as well as create touchpoints or marketing campaigns that could boost customer loyalty.

Next-gen tech for Wawanesa

Wawanesa is focused on supporting the broker channel by providing technology solutions that streamline processes, enhance service levels, and improve the customer experience. That includes AI.

“We have a vision of where AI can go and what it can do for us and our broker partners,” said Tracy Riley, Wawanesa SVP and Chief Insurance & Technology Officer in a recent podcast.

Over the next few years, Wawanesa will continue to enhance service levels by augmenting our processes with AI. This will allow brokers to quickly get answers to queries and access new insights. Digital claims is another focus, and we’re currently building out a roadmap to offer more products and services in this area.

Our focus on AI and digital claims is a key part of our commitment to technological advancement, but maintaining a balance with human involvement is also imperative to ensuring comprehensive and ethical decision-making. Human oversight is a crucial step in interpreting AI insights and ensuring client needs are met.

At Wawanesa, we help our brokers and members manage risk—whether it’s a known risk, an unexpected one, or a new risk that emerges. We envision a future where Wawanesa continues to provide financial security through risk transfer—working with brokers and members to proactively reduce and eliminate risk through prevention and advocacy. By leveraging technology, this future is becoming a reality.

Visit our commercial market web page for more information on key issues impacting commercial insurance brokers.