KEY TAKEAWAY:
--With the introduction of digitization and a focus on innovation, processes can be streamlined by allowing customers to purchase policies online, file claims on their mobile devices and receive real-time updates on their claims. This level of convenience may not be new to other sectors of the insurance industry, but it certainly is for specialty markets like those for boaters and water sports.
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In insurance, “specialty” has been left vague over the years. To me, it simply means niche, misunderstood, non-traditional, volatile. These characteristics all naturally drive away risk-bearing entities.
As a result, specialty markets have fallen behind the pack when it comes to innovation. The status quo has been rising premiums, abandoned markets and limited underwriting appetite. A lot of markets are threatened.
But they don't have to be.
Take boating and water sports, a threatened market where insurers have shown less appetite every year and premiums have shot up. With the introduction of digitization and a focus on innovation, processes can be streamlined by allowing customers to purchase policies online, file claims on their mobile devices and receive real-time updates on their claims.
This level of convenience may not be new to other sectors of the insurance industry, but it certainly is for specialty markets like those for boaters and water sports.
Renters historically were uninsured, which left a huge gap in coverage if they were involved in an accident. Renters found themselves either paying a large sum out of pocket or bringing a lawsuit against the business they rented from. But digitization makes it easy to offer renters a low-limits insurance policy to cover their exposure.
The result is a much healthier rental ecosystem for all involved and offers a model that can open up more insurance markets for rental businesses as a byproduct.
See also: How AI Can Solve Prior Authorization
The adoption of next-gen insurance tech in the “specialty market” mitigates risk immensely compared with the more archaic forms of operations that rental companies have been using for their entire lifespan. The new model rids them of uncertainty, volatility and misunderstandings.
The trick is to streamline the necessary processes through innovative yet user-friendly technology: doing things right but also efficiently.
By using technology, insurance companies can improve the customer experience, better understand risk and tailor policies to specific areas or activities.
As boating and water sports and other activities continue to grow in popularity, insurance companies must adapt and provide policies that cater to the unique needs of their customers.
It’s time we bring some clarity to specialty markets and provide solutions that have served larger markets for years. Not only is there a grave need for insurance in these niche areas, but there is also a huge opportunity. The insurance industry’s mission must be to continue to bring these innovative solutions across specialty rental markets from land to sea.
