Today I was interviewed at Ekonomiekot on Sveriges Radio (Swedish National Radio Broadcast) regarding the future of consumer insurance and how digital transformation will evolve or disrupt the industry (depending on how the incumbent companies tackle digitalization). My main point was that insurance policies of the future will be based on individual data, subscribed in real time by our digital assistants and decoupled into only covering my individual and specific need for the moment.
For insurance products where the consumer wholly or partly control the risk himself, this means that we’ll be able to pay for the actual risk we’re exposing ourselves and our possessions towards, for example by driving more environmentally friendly, sticking to the speed limits and such. And thus, that we have more influence over our cost of the policy. For health- and life-insurance products, tricky ethical questions quickly arise which will need to be tackled by the industry or potentially by government bodies and policymakers in order to not disqualify people that aren’t all healthy and without for example chronical diseases from having an insurance policy. However, these questions aren’t effectively handled by pretending they don’t exist and continuing with the same old and soon-to-be obsolete business models of yesterday. That will only leave incumbent insurance companies vulnerable to disruption.
Another big question that wasn’t really covered in the final aired interview, and which goes beyond the insurance industry, is the one of data ownership and privacy. As digitalization evolves there is from my point of view an increasing need for policymakers to come up with a modern legislation on consumer data. Ultimately this has to make the consumers owner of all their personal data, putting them in the drivers seat to choose whom to share this data with, depending on the benefit of the exchange. With this however, comes also a gigantic need of education, in order for consumers to fully grasp and understand their ‘new’ currency. Only then can the question of privacy be handled effective and fair.
Image credit: Alan Levine @ Flickr