Game-changing trends hit the industry hard in 2017 and “nimble will be the new normal” into 2018, according to forecasting experts at Deloitte. Successful agencies will show relentless flexibility in adding coverages and addressing cutting-edge threats.
Cyber is the New Normal
Cyber liability insurance needs to take center stage in 2018. No longer can small businesses assume they’re not in the crosshairs of hackers. More than 60% of cyber attacks are on small and mid-sized businesses, yet 78% still have no cyber liability insurance of any kind.
Ignore Rideshare at Your Peril
As Uber and Lyft have dominated local paid-fare travel, insurance agencies have struggled to keep up with coverage. Providers have been involved in numerous court cases about driver responsibility and the limits of liability.
One thing is clear: Agencies that don’t handle rideshare insurance are leaving money on the table. The U.S. has 160,000 rideshare drivers and counting.
New opportunity lies in the issue of rideshare gap insurance, which many consumers don’t yet understand. If agents can explain the gaping hole between personal and commercial auto insurance, this can be a lucrative niche.
Driverless Cars in a Hazardous World
The issue of driverless cars is predicted to heat up in the coming year. In what Deloitte calls an “existential threat to insurers,” autonomous vehicles shake up the issue of liability. When a human didn’t directly cause a driving error, who’s at fault? This question, and others related to driverless vehicles, will be a topic of discussion in the insurance industry in years to come.
Robots Don’t Get Workers’ Comp
Automation also threatens the employment sector, where robotic solutions are limiting opportunities for human workers. Despite an overall increase in U.S. employment in 2017, automation and technology are shrinking the size of the insurable workforce.
For insurers, this is a troubling trend. After all, robots don’t need health insurance, and so far the number of robots seeking workers’ comp remains stubbornly at zero.
Reluctant Millennial Homebuyers
As millennials age into adulthood, experts continue to disagree about the impact on the home-buying market, and thus the home-insuring market. In 2017, millennial home buying was at a record low. But young consumers may be warming to the idea of ownership.
Credit problems, student loan debt, down payments, and transient lifestyles are the biggest obstacles for millennial home buyers. Nevertheless, 80% of them still want to buy a home within the next 5 years. If the insurance industry can take the lead in making home ownership seem possible for millennials, opportunity abounds.
Attracting New Talent
In 2015, 25% of insurance agents were projected to retire by 2018. This statistic seems to be bearing out, and millennials aren’t jumping on board to replace retirees. To combat future employment struggles, agencies will need to offer an environment that appeals to new graduates and young workers. Strategies include offering flexible schedules, encouraging remote work, and advertising a clear career path to success.
Research shows that millennials are attracted to careers that help people. Insurance is the business of protecting people, something agencies will need to emphasize in 2018 and beyond.
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