Pressure mounts on motor insurers to reinvent themselves

Technological developments such as the advent of drive-assisted technologies and connected services are going to shake up the motor insurance industry, presenting a series of new opportunities and challenges for both traditional insurers and insurtech companies. Intelligent Insurer investigates.

Driver assistance technologies and connected services are going to transform the motor insurance industry. Insurtech companies are eager to take advantage of the new opportunities and grab business from the incumbents, but traditional insurers don’t plan to give in.

There is a lot at stake. Motor insurance is the most important line of business globally representing 42 percent of all non-life gross premium of total property/casualty insurance market, according to a recent report by Swiss Re and HERE titled “The future of motor insurance.”

And the business is threatened from many sides. Several fast-moving trends are set to reshape the industry. Car ownership is on the decline, particularly among urban millennials and other city dwellers, as people factor in the perceived high cost of car ownership as well as alternatives such as ride hailing like Uber and car sharing such as Zipcars.