Telematics, parametric cover and usage-based products reimagine insurance and allow insurers to deliver simplicity, affordability and convenience, a Zurich digital expert says.

Traditional insurance models can be rigid and complex, and therefore limited in how they provide coverage, Head of Customer and Digital Asia-Pacific Roopa Malhotra tells insuranceNEWS.com.au.

"Product innovation lies not only in introducing new areas of coverage but also through concepts such as telematics, parametric and usage-based,” she said.

Zurich’s parametric offerings include weather index insurance for Indonesian coffee farmers, an earthquake solution and a flight delay benefit on travel insurance.

“These have been designed around the principle of leveraging technology and third-party data to fulfil our claims promise to our customers and remove any inconvenience they may face when filing an individual claim,” Ms Malhotra said.

She says Zurich invests heavily in technology across the insurance value chain, with a focus on artificial intelligence (AI), big data and cloud computing that streamlines processes and provides personalised, data-driven insights.

Many insurers are in the early stages of capitalising on such systems due to a lack of clarity around how to integrate with existing distribution channels.

“Imagine, for example, using AI-powered call centre capabilities to analyse voice chats and provide personalised recommendations to agents. If a call centre is not on the cloud, implementing these enhancements becomes a lengthy and costly process. What could take a few weeks on a cloud-based system ends up taking months, causing delays and increased expenses.

“It is an exciting time for tech companies and start-ups to collaborate with insurers like Zurich. Across the industry there is significant potential to enhance customer experience by leveraging AI technology.”

Zurich has invested $US1.8 billion ($2.74 million) on technology over three years, mostly focused on digitalising its business and improving efficiency and customer experience. It says 89% of retail quotes are now digitalised.

The insurer is leveraging AI in more than 160 use cases, providing data insights to help underwriters, risk engineers and claims adjusters make decisions.

It has recruited more than 1000 digital technology specialists with skills in data analytics, AI, cyber security and cloud computing.