By Avryl Lattin, Partner, Clyde & CO and Rishiv Rathore, Associate, Clyde & CO
As the insurance landscape changes, regulators will need to consider whether the current approach is still appropriate. Two main areas of change that are immediately foreseeable are product design and distribution, and disclosure.In Australia, following the passage of the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019 (Cth), accountability for product design and distribution will shift onto issuers and distributors, such that insurance products will need to be designed with a particular consumer in mind. This legislative change is intended to ensure that complex financial products which are not always easily understood by consumers are aimed at the right markets. Leveraging big data and analytics, insurtechs are uniquely positioned to help insurers provide insurance products that are tailored to a specific consumer and can also evaluate the suitability of an insurance product with a greater degree of efficiency and accuracy.
Insurance leaders of tomorrow must prepare for the adoption of Artificial Intelligence, Blockchain, Big Data and Analytics, connected devices (IoT), and new business models