New data-driven insurance business models are set to emerge in the near future, fuelled by the digital transformation sweeping across the industry, a Swiss Re Sigma report predicts.

The changes are broadly seen as positive, helping insurers to understand consumers better and improve the way they operate, including with key suppliers.

“As a result of digitalisation, insurers now have direct connection to their customers,” Swiss Re Institute Chief Research and Innovation Officer Jeffrey Bohn said.

“With the availability of granular data, insurers can better segment customers, which enables them to develop new tailored products and services, and refine existing ones in real time.

“This benefits customers and insurers alike.”

The Sigma report says the future insurer can be defined as one that is hyper-aware of customer needs and preferences with a range of personalised, flexible products offered in real-time.

“Data-enabled processes will minimise friction and streamline the customer insurance journey, from request for coverage to claim,” it says. “Artificial intelligence will be used to interact and build understanding of the customer, and servicing will be through virtual assistance, 24/7.”