TECHNOLOGY
SAS ’ FIVE CHALLENGES FOR IOT WITHIN INSURANCE
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Norman Black , Principal Industry Consultant at SAS , has explored and refined the contemporary challenges of integrating IoT with insurance into five categories : 1 ) Disruption to existing business models : Although the potential of significant savings for low-risk insurance prospects is amplified by IoT-augmented insurance , so too are the negatives for highrisk prospects , which may face greater penalisations than under new data-centric rules . Falling revenues from cheaper policies will also need to be addressed with new IoT-focused streams for profit .
2 ) Data management : Using IoT to generate large data streams might be advantageous , but it is only useful if insurers have sufficient analytical and processing software to gain insights from it quickly .
3 ) Data ownership : Legislative efforts such as GDPR have attempted to remedy this problem , but it is far from solved on a global level . With a large amount of sensitive customer information on-hand , companies will need to tread carefully .
4 ) Regulation : Certain IoT devices , such as wearables for healthcare purposes , can provide invaluable information on the user ’ s condition . However , insurers must be cautious not to overstep privacy or become invasive to privacy .
5 ) Security and fraud prevention : Although insurance may become more accurate generally , Black warns that IoT could also present new opportunities for fraudulent applications and claims .
SEPTEMBER 2020