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Internet of Things and insurance

A connected future

Are we ready for “smart” insurance? Using information collected from a think tank of 23 European insurers from 18 groups across 8 countries, our exclusive study examines the possibilities surrounding three Internet of Things connected insurance solutions—car, home, and health—and how they could substantially change value propositions, from customization of offers and customer relation management improvements, to prevention and early detection. Our findings show that the future of insurance won’t just be connected, but that the process is already underway.

We discovered that 60% of European top insurers have already launched connected car solutions using smartphone apps, dongles, or blackbox devices—a market currently led by Italy and the UK. Yet, only 6% offer connected home solutions and only 3% have connected health offers. When drivers such as savings, knowledge and control, early assistance, and claims reductions are weighed against hurdles like costs, data privacy, and regulatory constraints, connected car solutions appear to be the obvious choice for investment. Although projected to remain the leading market for “smart” insurance well into the future, considerable relative growth is expected in connected home and health solutions as well, making these market segments increasingly relevant for insurers and consumers alike.

60% of European top insurers have already launched connected car solutions using smartphone apps, dongles, or blackbox devices
60% of European top insurers have already launched connected car solutions using smartphone apps, dongles, or blackbox devices

Key initiatives

Insurers will likely play one of two roles in the Internet of Things: the builders of leading IoT ecosystems, or the deliverers of IoT linked insurance and assistance services. However, building dominant IoT ecosystems appears at present to be a less likely scenario, and new regulations, social trends, and private initiative show considerable potential for leading to user empowerment. Whatever the outcome of the next 2-3 years, the impact of different scenarios on future connected insurance offerings will require specific capabilities to succeed. Our study outlines several likely scenarios in detail and offers well-considered guidance for key initiatives that will ensure competitive success across a breadth of potential outcomes.

Internet of things
Study

IoT and Insurance

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Possibilities surrounding three Internet of Things connected insurance solutions—car, home, and health—and how they could substantially change value propositions

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