Technology changes are shaping the way businesses operate worldwide. Whether you own a small business or a large enterprise, today you are exposed to more risks than before.
Even in Canada, while business insurance is quite comprehensive and protects business owners from different types of risks, there are still underlying trends, fundamental in nature, that are causing insurance companies to rethink and come up with new products and services to cater to these trends.
Agility and customer experience
Today’s fast-paced business world is used to working in a real-time mode. Progress in technology and user-friendly interfaces have raised the expectations of business owners and they are now expecting more from their insurance companies.
As a result, business insurance Canada is undergoing transformation. Insurance companies are transforming their service offerings to improve the overall customer experience, end-to-end. They are mapping the customer journey across various touch points where the customer engages with them such as buying a policy, filing a claim, or tracking a claim.
Some of them are simplifying the wordings and removing legal language and fine print, with an aim to make the policy document easier to understand. However in this transformation they are being cautious and not compromising on security. This ensures that the trust reposed by the business owners in the insurance company remains intact.
New age technologies and cyber-risk
A few years ago cyber risk was quite unknown, but today it is a serious threat to businesses. Almost every business today is heavily dependent on technology, and business owners are required to protect the personal information and data of their customers.
Also, as technologies are now getting obsolete in two or three years, business owners need to upgrade their systems, faster than before. For example insurance coverage should allow for replacement of old equipment with next-gen technologies such as mobility, data analytics, AI & ML
Global supply chain and global marketplace
Markets are today globalized and the supply-chain network extends across various countries. For example, very often products are created in a lab in one country, raw materials for the same are procured from a second country and finally assembly and manufacturing are done in a third country. The end product is then sold globally.
To keep pace with this ever-growing complex network of international manufacturing and distribution, insurance products and services have to be redesigned, so that they are in sync with the new paradigm. This also ensures that rights of customers are protected and agreements related to international copyrights/ patents and royalty payments are protected.
Sustainability and climate change
This is a trend that is most affecting business insurance Canada. Global warming and deforestation are leading to extreme weather conditions in Canada. Hurricanes, tropical storms, floods, droughts occur more frequently than before and cause devastating fires. Water damage and heavy snowfalls are also quite rampant now, and severely impact buildings and infrastructure.
As a result of the above, insurance companies need to be better prepared to handle claims arising from losses due to natural disasters.
Increasingly, businesses are making use of shared services. An example could be shared work places, shared accommodation/ living places, or shared transportation services. Until a few years ago there used to be just one user of a product or service, but now the same is being used by others; i.e. in some industries the business model is shifting to a multi-user model and this affects the way insurance companies protect business risks. It is being expected of them to cover the risks posed by the emergence of the new economy.
Although these trends are underlying in nature, insurance companies are aware of them. They keep bringing out new products and services to meet the demands of the market, provide protection to business enterprises against new types of risks, and to mitigate new challenges of the future.