The key to unlocking the insurance industry, writes Richie Hecker in TechCrunch, is understanding behavioral economics.
The most successful players in insurance tech, he says, will win by rounding the edges on existing products. “Don’t reinvent the wheel, take what works and make it work for today. That means making policies be more transparent, providing better user experiences and aligning incentives to adapt to the world in which we live.”
His other recommendations are just as straightforward: provide clear and transparent insurance policies to customers, apply user experience design (and incentivize users to collect as much data as possible), and align incentives (so the user is incentivized to handle small issues themselves, with zero handling cost, and using their insurance for the big expenses).