Insurers must find ways to engage younger consumers sooner and should look for more creative alternatives for providing cover as the market evolves, an EY report says.

Asia-Pacific Insurance Sector Leader Grant Peters says the region is extremely diverse in terms of market maturity, insurance penetration and the adoption of new technologies.

“Insurers need to recognise the changing demographics across the region and meet multiple customer needs through more targeted value propositions, product innovation and omni channel distribution strategies,” he says. “With disruption coming from all angles, those that don’t prepare now will get left behind.”

EY’s Next Wave report focuses on personal lines and small commercial insurance and looks at how providers around the world must adapt to rapid change.

It notes the impact of climate change and opportunities for insurance inclusion and looks at scenarios in eight evolving areas that will have an impact in the next five to 10 years.

“These scenarios highlight more than ever that insurers need to focus on the evolving needs of their customers, and how customer needs will continue to change into the future,” Mr Peters says.

Streams of data from connected devices are forecast to drive “real-time risk visibility” for customers and insurers, while direct and digital channels will increasingly dominate the mass market.

Incumbent insurers will see more non-traditional providers seeking to capture business, with the market entry of tech giants seeming inevitable, the report says.

Challenges and opportunities from driverless vehicles and cyber risks will be a major focus, artificial intelligence is seen as having a rising impact on claims handling, while new alliances and partnerships will be necessary, according to the scenarios.

See ANALYSIS