The future of insurance is embedded
Anyone who works in the field already knows the saying. Insurance is not bought, it is sold, says the common sense of the sector, reinforcing the need to go after the customer and convince him. Well then. A new, but not so new, modality of insurance sales promises to put this saying in its proper place. In the past.
It is embedded insurance, integrated or embedded insurance, in Portuguese. The modality allows the consumer to take out insurance when buying another product. Perhaps you have already purchased an extended warranty on an appliance or cell phone insurance in this way.
Now, the big change comes with the digitization of our daily lives, expanded after the Covid-19 pandemic. People’s shopping habits have migrated online and insurance has become an integrated component of digital shopping.
Are you going to buy an airline ticket on the company’s website? How about insurance for an eventual flight delay? Choosing furniture for the new house in the store app? Take advantage and take out home insurance. It’s a new era where insurers can reach buyer segments they’ve never reached before.
With embedded insurance, it is possible to provide personalized recommendations to each consumer. For individuals, families, companies, it is the certainty of hiring a more affordable insurance and adequate to specific needs, whenever and wherever they want.
The numbers indicate that embedded insurance is the future of insurance sales. A report by InsTech London indicated that the market will reach $722 billion in premiums by 2030, more than six times its current size. Fintechs, medium and small retailers and professional category associations, for example, are promising markets for embedded insurance. And major international investors have their eyes on Brazil.
At Insurtech Connect Vegas, the world’s largest insurance innovation event, from September 20th to 22nd, this topic will be on everyone’s tongue, especially those who come from Brazil, a country that usually has the largest number of representatives in debates and in business.
This revolution is only possible thanks to insurtechs, a name that combines insurance (insurance) and technology (technology) to define companies that use technology to create applications, management systems, sales modalities and process automation in the insurance sector. In Latin America, most of these companies are headquartered in Brazil, a country where the population’s adherence to insurance is still small. Stay tuned. Embedded insurance will contribute a lot to change this reality.
* By Thiago Soares, Stere Regional CEO LatAm