The digital world is shaking up the market in a number of ways
Digitalisation is taking over every aspect of public and private life. Computerisation and networking is continuing to expand in production, transport, science, government and the home. This is creating great opportunities: processes are becoming infinitely reproducible, exacter, safer and more cost-effective overall. And some possibilities for innovation are being created altogether..
Internet of Things and Cyber Risks
Digitalisation and the insurance industry
Digitalisation is the key to a successful future for the insurance industry. Capital alone is no longer enough. In order to meet the changing needs of its client base, the insurance industry has to invest in hardware and technology such as the IoT and data analytics. The experimental approach being used in tech-hubs such as Silicon Valley, London, Berlin, Peking and Israel, offers an advantage in dealing with digitalisation. This approach has the possibility to turn the industry on its head. Munich Re has deployed innovation scouts and has its own labs in all of these hotspots, where it is at the leading edge in developing innovative solutions together with its clients and other start-ups.
Digitalisation will open up a broad spectrum of new and better applications and facilities. It will increase effectiveness and efficiency in production, create new technologies for private users and businesses, and revolutionise practically every aspect of our lives.
Data analytics and artificial intelligence open up new possibilities for managing and covering risk. Nowadays, Munich Re experts combine primary insurers’ portfolio data with external, public sources, for example about site geography, building construction, weather or socio-economic status. By applying machine-learning principles, Munich Re can discover hidden loss drivers and respond accordingly, for example by introducing loss-prevention measures or adjusting pricing.
Only those who make use of the opportunities offered by new technologies gain competitive advantages through innovation and productivity. The earlier the potentials of trends for one’s own business model are recognised, the better they can be implemented. Munich Re analyses top technology trends for insurance companies annually in the Tech Trend Radar.