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Insurance: 2020 and beyond

Mar 10, 2020
Wondering where the relocation and mobility vertical is headed in the coming decade? Here’s a snapshot of where we are today, along with some predictions for the future.

Insurance - 2020 and beyond

Where we are: an insurance industry snapshot

Although it’s still too early to summarize 2019 results, we know that US property and casualty insurance rates have been hardening over the first three quarters. This is in response to high liability and catastrophe losses, as well as lower yields on fixed-income securities. Industry experts predict that rates will continue to rise throughout 2020. As part of the hardening market, we may also see less insurance capacity. This means that insurers may become more selective and restrictive in the coverage offered.

For the relocation/mobility industry, this increased selectivity may result in fewer insurance program options and tougher requirements – both for agency partners and the companies insured.  With this in mind, it’s important to shore up loss prevention and claims containment efforts now, well in advance of insurance renewal dates.

Where we’re headed: evolving needs

In addition to preparing for changing insurance appetites, we all must realign our moving and relocation offerings with the changing needs of consumers.

Over the past decade, we’ve seen shrinking shipment sizes. This trend is likely to continue. In the past, Silent and Boomer generations shipped a lot of furniture, including antiques and family heirlooms. Today, Gen X, Xennial, Millennial and Gen Z shippers live in smaller spaces and don’t accumulate as much. They often use ready-made furniture which can be found in stores like IKEA and Wayfair.

They also move more frequently. The percentage of 25 to 34-year-olds who have lived in their current home for less than two years rose from 33.8% in 1960 to 45.3% in 2017, according to Zillow.

Today, shippers are less likely to use a full-service mover and more likely to use services or apps, like HireaHelper, Bellhops, Lugg, BuddyTruk, which in some cases, provide a type of coverage that competes with traditional moving insurance vendors.

These changes will ultimately cause a decrease in moving insurance policy volume. To adapt, insurers will need to modify their coverage types, insurance terms and deductible levels and develop methods to engage shippers faster and more efficiently.

Where we’re headed: technology

While most, if not all relocation and mobility insurance providers have moved their services online, many are not yet completely automated or fully capable of collecting and analysing the data they collect. We need to get there.

Due to the complexities of the relocation insurance segment, it’s unlikely that insurers will sell direct-to-consumer, therefore moving insurance agencies and insurance program managers will continue. However, these companies will need to adjust to the digital communication demands of younger generations.

I expect less interaction between insurance service providers and shippers, and more communication between the systems of service providers, shippers and all parties involved in the move. These interactions will be two, or maybe even three-way conversations, connecting data and providing practical solutions simultaneously.

Artificial Intelligence (AI) is everywhere, yet almost non-existent in the relocation/mobility world today. But why is that so? Can’t part or all of the process be handled by AI?

I predict that AI will eventually play a big role in underwriting and binding insurance. It may also become predominate in all other aspects of the insurance and relocation industries. Fortunately, for all of us humans, artificial intelligence must be designed, monitored and maintained by human intelligence.

As the moving/relocation industry begins to use AI, autonomous trucks, and other smart devices, insurers will need to adapt their offerings to protect against evolving risks.

Where we’re headed: space

As mic.com writes: “It’s a grim truth: The Earth is heating up, sea levels are rising and people - as well as animals - are dying as a result. The logical answer, at least for some, is to pack one’s bags and colonize outer space.”

Roughly 200,000 people have already become citizens of a future space kingdom called Asgardia. Before the space kingdom is inhabited, researchers will have to solve a few key questions, like how to keep people alive with “space surgery” once they’ve set up galactic camp. When they find the answers, the relocation and mobility industry will have to figure out how to manage relocations to space.

One day it might be possible for humans to travel from Earth to other stars in our galaxy and to other galaxies. Once humans are travelling in space, their household goods will soon follow, along with the relocation/mobility insurance providers.

These solutions must be provided by Earth insurers first, therefore we, the Earth insurance brokers, must start laying the groundwork now, so we don’t “miss the rocket” so to speak. Conditions in space are obviously different, but I predict that household goods will continue to have importance, and as long as that’s true, risk exists, and insurance will be needed.

Where we’re headed: new insurance products and currency

Currently, relocation insurance is sold as a standalone policy, protecting goods in transit or storage, and either including or excluding packing and unpacking. In the future, we may see moving insurance added to homeowners or renters’ policies, or to home warranties. Suites of insurance coverage may be marketed together as a unified macroinsurance policy.

Insurance is presently bought and sold via the common currencies of the world. Technology allows insurance providers and consumers the ability to choose their own familiar currency, making it easier for all participants. But is it easier? Maybe not.

I predict that in this decade, insurance will be traded under its own currency, such as insurance Coin (InsCoin). For example, when a shipper/transferee, is relocating from Zimbabwe to Moldova, there will be no need to convert currencies, as insurance will be traded under the InsCoin, and the US booking agent, UK insurer, origin and destination agents, as well as the Canadian transferee, will all speak the same language as it pertains to premium, value and potential loss compensation of the shipment.

Be or be gone

Our world is changing. Personal, public and business demands are more complex than ever. Innovation is not a concept anymore; it’s a reality. Both the moving and the insurance industries have been slow to adapt. However, we have recently seen some new advancements such as video surveys, mobile quoting and self-dispatched containers.  We’re also seeing direct lead to policy services, personalised insurance terms and real-time claims payments.

Change is happening, innovation is all around us, and although we will always need trucks, moving companies, and humans to monitor the moving insurance process, we are getting closer to deploying exciting new processes and technologies, which we will experience in this decade. A simple statement sums up the future: “Be or be gone.”

Gadi Binness is the Founder, CEO and President of Relocation Insurance Group, an online insurance agency, and a pioneer in the moving, self storage, mobile storage and logistic insurance segments. Relocation Insurance Group (RIG), manages a suite of websites, including www.relocationinsurance.com, www.movinginsurance.com, www.mobilestorageinsurance.com, www.logisticsinsurance.com and more. Gadi can be reached at gadib@relocationinsurance.com

Gadi Binness, CEO and President of Relocation Insurance Group

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