Did You Know?
The term ‘metaverse’ originated in a science fiction novel about three decades ago. In this fictional world, characters were imagined as avatars in a virtual universe.
The impact of metaverse in insurance
Metaverse technology offers promising opportunities for transforming the insurance industry. One notable application is the development of virtual insurance offices, allowing customers to engage with agents in a digital realm. By replacing physical office spaces with virtual environments, insurers can significantly reduce operational costs while providing convenient and accessible services to their clientele.
Moreover, metaverse technology enables immersive training simulations for insurance agents. These simulations offer a realistic setting for agents to practice handling various scenarios, enhancing their skills and readiness for real-world situations.
Additionally, metaverse technology can streamline the claims process. For example, augmented reality tools empower customers to capture and upload images of accident scenes to a virtual claims’ office. Leveraging blockchain technology ensures secure storage and processing of claim-related data, leading to faster and more efficient claims resolution.
Challenges
However, despite its potential benefits, the adoption of metaverse technology in the insurance sector faces challenges. One major obstacle is the lack of interoperability between different metaverse platforms, potentially impeding seamless integration and collaboration across the industry. Furthermore, ensuring the privacy and security of sensitive customer data collected in the metaverse is essential for building trust and compliance with regulatory standards.
Addressing these challenges is crucial for unlocking the full potential of metaverse technology in revolutionizing insurance operations and enhancing the overall customer experience.
Use cases of metaverse in insurance
Sales and marketing
Life and P&C insurers can utilize VR platforms to demonstrate their products effectively, aiding customers in making informed choices. VR can also be used for agent training, enhancing their understanding of insurance processes.
Customer service
A Middle Eastern government agency established a virtual service center in the metaverse, offering seamless assistance to customers. This virtual setup mimics the experience of a physical store, catering especially to the elderly and people with disabilities.
Underwriting and claims
XR technology enables underwriters and claim adjusters to inspect assets remotely with precision, reducing the need for site visits. It also aids in fraud detection by simulating accident scenes based on AI and historical data.
Health and wellbeing
Insurers can leverage the metaverse to promote fitness among policyholders. Virtual coaches and interactive experiences encourage healthy habits, potentially reducing insurance claims and improving overall wellbeing.
Revenue generation
Personal risks
The immersive experience of the virtual world through head-mounted devices and spatial sensors can lead users to forget their surroundings, resulting in accidents and property damage. In 2023, one major insurer reported a 31% increase in claims related to metaverse and VR device accidents. Insurers may consider adjusting premiums to cover these risks.
Property and digital asset risks
The rise of the metaverse creates new digital marketplaces, where consumers can purchase virtual assets like branded merchandise, digital art, and virtual real estate. As the value of these assets grows, there’s a growing demand for insurance to safeguard digital investments, presenting new business opportunities and the need for innovative insurance products.
Cybersecurity and data privacy risks
The use of head-mounted devices entails exchanging sensitive biometric and financial data through remote servers, raising concerns about cybersecurity and data privacy. Over time, these devices accumulate a wealth of consumer information, including shopping habits, preferences, and personal details, highlighting the importance of robust data protection measures.
Six steps insurers can take now in the Metaverse
1. Figure out what you need
Choose the right technology for the metaverse and set up processes to make it work smoothly.
2. Try new things
Test your ideas with small groups of people and keep improving them based on their feedback.
3. Learn new skills
Teach your team about the metaverse using training modules and consider hiring experts or getting specialized training if needed.
4. Stay safe
Keep an eye on the rules and make sure your operations are secure from scams and other risks. Build trust from the start to avoid problems later.
5. Test new insurance ideas
Experiment with new insurance products that cover risks in the metaverse, starting with areas you already know well.
6. Keep learning
Use what you learn to improve your products and services and be ready to adapt as the metaverse evolves.
Bottomline
Insurers can change how people see them by getting on board with metaverse tech early. By using this tech to make things better for customers, agents, and staff, insurers can really stand out. There are lots of chances to do cool stuff in insurance, so insurers need to find the best ways to make things special for everyone involved. To do that, they need to start trying out new ideas and exploring what’s possible with metaverse tech while it’s still new. And the best time to start doing that is right now.
