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In our earlier post, we had written about how the insurance industry has embraced advanced technologies, starting with IoT that included connected wearables. It is now time to talk about the pros and cons of these wearables.
Over the last few years, there has been a shift in how insurance enterprises have approached sales and business. Similarly, there has also been a tremendous rise in the popularity of wearable technology, such as tracker devices, smartwatches, smart clothing, accessories, sportswear, and much more.
Therefore, it is no surprise that both the customers and the business owners have understood their value and adapted to using them to enhance the customer experience and boosting business growth.
One needs to consider the pros and cons of the connected wearables before jumping into the deep end of the pool.
Top Benefits of Wearables
The wearables provide unmatched opportunities to collect real-time data that is relevant and reliable. The data is useful in improving business decisions. Life and health insurance companies are leveraging wearables and related sensor-based devices as they offer accurate information, thereby reducing the risk of fraud.
The real-time data gathered from a customer’s wearables, data analytics generated thereon are used to design and personalize insurance products. Based on the risk exposure and the data, insurers can offer products to customers that suit their preferences and lifestyle patterns.
Wearables are a boon to the insurance industry, especially with limited opportunities offered by traditional methods. New technologies allow insurers to interact and stay connected with their customers regularly. The communication extends across all processes, such as policy issuance, query management, and cross-selling.
With wearable devices, insurance enterprises can provide rewards and discounts to their customers. The insurance premium amount is calculated depending on the risk pattern and data analyzed. Similarly, the device also gives alerts and notifications to the customer if there is a significant change in their activity.
Research has proved that insurer’s productivity goes up by 10% when the company uses wearable devices. These devices allow the insurer to complete tasks faster and more efficiently. It is true in the insurance space that depends on paperwork and personal touch.
Drawbacks of Wearables
Brands such as Apple, Samsung, Nike, and every other major player have launched their wearables, such as gadgets or clothing lines. While the customer has ample choices, the investment is high. Similarly, the insurance companies who invest in the systems and technology need to ensure the devices can be connected and supported.
While Fitbit trackers have a strong battery life, Apple watches don’t. Also, with low charge or low connection, the data captured might not be 100% accurate. If the data gathered is inaccurate, it would affect the analytics, which would affect the policy offered and premium (especially for people with heart conditions or serious ailments).
The data from the wearable devices need to be kept safe and secure by the insurance company. Customers do not like their data shared or used for any purpose apart from their insurance policy-related discussions. There need to be adequate security systems in place to prevent hacking or other fraudulent acts.
Information is always valuable, and when it comes to data from these wearable devices, the customer and insurer stand to win equally. But then, the downside of using these wearables is the customer could get obsessed, constantly monitoring the data, updates, ensuring they are on top of their game. While it sounds like a good thing, it can prove detrimental if their health takes a toll because of working out too much or being too focused on the device and not driving right, putting the vehicle and their own life at risk.
At Neutrinos, we have been innovating and adopting advanced technologies. Apart from mobile apps, we work with AI, ML, digital twins, and wearables. We enable clients to harness iBPM Solutions to automate time-consuming, manual processes and maximize productivity.
Are you looking to adopt wearables into your business?