In an article by Oliver Ralph entitled “Insurance still defying the charms of technology” (Report, January 12) he points to consumer apathy towards insurance as the main reason for the lack of impact of insurtech on consumer insurance.
I would like to add the higher cost of insurance as another important factor. Between 65 percent (home insurance) and 90 percent-plus (car insurance in a bad year) of consumer premiums are paid to brokers or advertising fees, whether they are pay-per-click or referral fees. leaves.
The groups with the highest volume have the lowest costs.
In industries with low costs, disruptive innovators can use these lower costs to lower prices for end users, thereby buying market share. This is enhanced as modern IT platforms offer significant cost benefits compared to legacy players.
A good example is the payment business. With very low variable costs, it has been converted into a much larger than life insurance policy. Although it is sometimes old-fashioned, insurance has become very effective in providing protection to consumers within limited limits.