Understanding the InsurTech dynamics in the transformation of the insurance sector

Abstract

InsurTechs have transformed the insurance sector by becoming a fundamental role in leveraging technology to respond to business and costumers needs, driving solutions based on the availability of new data sources, the interconnectivity among actors, or even access to new possibilities in terms of risk hedging. InsurTechs

What is an InsurTech? A scientific approach for defining the term

“…Pursuing the above argument, previous research findings (Sosa & Montes, 2022) have identified five InsurTech driving capabilities that have been instrumental in boosting innovations in the insurance sector. According to what has driven InsurTech, these capabilities suggest 15 innovations transforming the insurance sector.…”

“…On the other hand, the pace of technological change in the last decade has been exponential (Catlin & Lorenz, 2017; Lee & Shin, 2018) in a sector that is being boosted by technology (Cappiello, 2020), which is driving the fundamental transformation of the insurance industry by having a new way of interaction between insurers and customers, digitizing and automating business processes and creating new products (Eling & Lehmann, 2018). For both reasons, InsurTechs should be seen as technology‐driven innovations coinciding that have disrupted, accelerated, and enhanced the transformation of the insurance sector from the traditional structure leading to a dynamic user‐centric ecosystem (Sosa & Montes, 2022). Nevertheless, what is noteworthy is that, despite the agreement among scholars on the significant impact that Insurtechs are achieving in the insurance sector, the academic literature still needs to establish a consensus definition of InsurTech.…”

“…Following the research work carried out by Greineder et al (2020), this scenario is presented defining the current structure of the insurance sector after the impact of InsurTech is presented below (see Figure 3). From the argument preceding, InsurTech has had a fundamental role in the transformation of the insurance sector, with the development of different solutions that are responding to the challenges of the sector, such as challenging the traditional business with a personalized offer, improving the relationship with the customer and providing new sources of revenue as well as greater operational efficiency, which is offering new opportunities (Sosa & Montes, 2022). Furthermore, these opportunities are enabling the potential of InsurTech in the transformation of the insurance sector, which has emerged from the combination of the innovations themselves, establishing real-time remote connectivity, which is essential to continuously improve data-driven decisions, leveraging technology to hold digital conversations and provide virtual advice to consumers, supporting the automated formulation of a new insurance offering tailored to consumers' needs, facilitating greater penetration of digital insurance distribution.…”

“…Thus, it is comprehensible that the insurance sector has transformed as a consequence of the impact of InsurTech (Sosa & Montes, 2022). In this regard, an InsurTech could be defined as any innovation driven by technology in the insurance sector, which can refer to software, any application, platform, or a start‐up, as well as products and services (Braun & Schreiber, 2017).…”

“…Notably, investment in InsurTech soared to an all-time high of $15.4 billion in 2021, nearly double the previous year, revealing that the capital flux is already reshaping the insurance industry's future (CB Insights, 2021) (Figure 1). Thus, it is comprehensible that the insurance sector has transformed as a consequence of the impact of InsurTech (Sosa & Montes, 2022). In this regard, an InsurTech could be defined as any innovation driven by technology in the insurance sector, which can refer to software, any application, platform, or a start-up, as well as products and services (Braun & Schreiber, 2017).…”