Insurtech initiatives will lower property/casualty rates

Insurtech initiatives will lower property/casualty rates representing a win-win for all, according to MarketScout, the Texas-based insurance exchange, MGA and forecasting company.

Richard Kerr, CEO of MarketScout, said: “By utilizing new tech-enabled distribution, underwriters are ultimately going to reduce acquisition expenses, which will enable them to offer the consumer a lower premium. The end result will be a win-win: a net premium reduction for the insured and an increase in ROE for the insurance company.

“The property and casualty insurance industry has the highest distribution expense of almost any financial services industry, or for that matter, any industry. With distribution expense as high as 32 percent, you can be assured technologically capable millennials are going to connect with some savvy grey haired insurance folks and come up with a better mousetrap. There are already many plans under way to reformat distribution.

“Naturally this reformation will begin with the low hanging fruit of the industry, commoditized products. Auto insurance is a great example. Large accounts and specialty insurance will ultimately be impacted, we just don’t know when or exactly how.”

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