The insurance industry is one of the largest forces in Canadian business, affecting virtually everybody in the country. It is also a rapidly changing industry, with regulations, technological shifts, and societal trends holding great influence over it. For those investing in the industry, knowing the challenges within it can make the difference between a profitable venture and a waste of money. Here are the key challenges facing the insurance industry as seen by experts like Nicholas Kyriacopoulos.
Cybersecurity
The insurance industry collects more personal and confidential information than almost any other field. This makes them a frequent target for cyber threats. Hackers would love to get access to the storehouse of information that a typical insurance company banks, and they constantly test the systems for weaknesses as a result. A data breach not only puts clients’ information at risk but can damage a company’s reputation for years to come. As a result, most insurance companies spend a great deal on protecting their cybersecurity. The alternative is putting that money toward settlement costs when a data breach inevitably occurs, so an ounce of prevention is worth a pound of cure in this case.
Digitization of Small Business Insurance
Over the years, small business insurance, also known as small commercial, has not had to modernize due to its relatively tiny niche. However, as more businesses arise and successful entrepreneurs like Nicholas Kyriacopoulos turn them into major cornerstones of industry, more aggressive insurers are beginning to take an interest in small business insurance. This means that companies already involved in the small commercial field need to upgrade their systems in order to be competitive. Old methodology is giving way to digitization and upgrades to a 21st century model of doing business. This means that companies which offer small business insurance need to make a greater investment in employees with tech skills.
Data-Driven Improvements
Once upon a time, people used anecdotal evidence from clients and their own gut instincts to change the shape of business. This benefitted those who had good instincts, but it also left many potential customers out in the cold. Modern entrepreneurs like Nicholas Kyriacopoulos strive to use hard data and facts to make changes. This strategy carries over into the insurance industry, where data generated by live chats, mobile apps, and other technological innovations allow businesses to keep closer tabs on what their customers really want and need.
Reputation Management
A number of news exposés, social media trends, and word of mouth reporting have led to stories about corruption at the highest levels of the insurance industry spreading far and wide. As such, people are more hesitant than before to make a serious investment in insurance. These fears are largely driven by reports of arbitrary price increases, uncooperative agencies, and other obstacles that lead people to believe they won’t get a return on their investment. The only solution to this problem is a matter of action; companies need to work hard and honestly to regain consumer confidence.
Economic Instability
The economic instability caused by the COVID-19 pandemic affects everything, including insurance companies. Unfortunately, few customers see the math that goes into determining insurance rates. Because the industry has a poor reputation among some due to years of mismanagement, this only adds to the general level of mistrust held by consumers. As a result, many companies struggle with brand reputation when an economic crisis forces rates to rise.
The current year has created numerous new challenges for the insurance industry, and 2022 doesn’t guarantee a return to normalcy. Those who monitor the industry, such as Nicholas Kyriacopoulos, have observed these challenges and are prepared to adjust to them, thus allowing them to profit from the current environment while everybody else catches up.
