The life insurance industry is a laggard when it comes to using technology to generate new business innovations, according to a Swiss Re report.

This could hurt insurers in the long term if they remain cool to the benefits of digitalisation and other technological advances.

“Digitalisation and the spread of the internet and mobile technology have transformed a number of industries,” the reinsurer says.

“Technology and the digital data revolution will fundamentally change the business of insurance. To grow their business, insurers will need to review their investments in technology, rethink talent strategy and adapt their business models.”

A few life insurers have started putting resources into data analytics capabilities, but most have yet to fully embrace technology in their operations.

Areas where technology can have the most meaningful impact include client interaction and risk assessment, Swiss Re says.

“New technologies can enhance consumer engagement with life insurance by making the application process easier and by using rewards programs and techniques such as gamification.

“New sources of data and predictive modelling tools offer opportunities for more granular client segmentation and better identification of clients’ needs.

“In addition to better targeting the existing customer base, new technologies also offer the potential to reach new customer segments.”

For insurers looking to reach younger consumers, in particular Generation Y, digitalisation will be a key to success.

“The younger generation in particular have grown to expect easy and quick access to information in commercial interactions, transparency about cost and value, and high-quality service. Not surprisingly, consumer surveys show insurance lagging behind most other industries when it comes to customer satisfaction from online experiences.”