Survey indicates wearable tech adoption by insurers
A 2014 survey by research advisory, Strategy Meets Action (SMA), reported that 3 per cent of insurers have already begun to use wearable tech – which refers to any miniature technological devices worn attached to the body. The survey also revealed another 3 per cent are experimenting with the devices and 22 per cent are developing strategies for utilising the new technology. Accenture conducted another recent survey which looked at insurer executives in nine countries which found that 63 per cent of these Unit trust companies and life assurers have been aligning their efforts in reaching a common measure of investment costs they may now be required to disclose as new disclosure requirements that will enhance transparency in the unit trust industry became legally effective last month. The Association for Savings & Investment SA (Asisa) is overseeing the alignment of the two industries in reaching the effective annual cost (EAC) which is a standardised measure of investment costs. If the EAC becomes a mandatory disclosure, it will allow for a cost comparison across the board of collective investments and life assurance portfolios. The EAC will likely be enforced at the introduction of the new legislation that will regulate the conduct of financial services providers under the new market conduct authority which will be created after the Financial Sector Regulation Bill is enacted. Collective investment scheme companies will now also have to publish minimum disclosure documents and update their fund fact sheets to meet the new requirements as per the board notice issued by the Financial Services Board (FSB) last August which became effective this month. The board notice was issued with regard to the Collective Investment Schemes Control Act (Cisca) Unit trust companies within Asisa have previously followed a voluntary code for advertising collective investment schemes without legal requirements for information provided on their fund fact sheets. The FSB, who regulates the sector, has undertaken to furnish new advertising and disclosure requirements for collective schemes after the International Monetary Fund and World Bank’s Financial Sector Assessment Programme found the voluntary code problematic due to Asisa not being a proper self-regulatory industry body. Schemes are now obliged under the new Cisca board notice to submit all marketing and advertising material to the FSB for approval. executives believe the insurance industry will broadly adopt wearable technologies within the next two years. Almost one-third of the respondents indicated they are already using the devices to engage employees, clients, and partners. Tony Benton, vice president of research and consulting in insurance at Novarica, outlined key potential uses for wearable technology in insurance in a 2014 brief: Wearable Technologies and Insurance, which focused on the data- capturing advantage for claims procedures. Other areas where wearables could prove useful included marketing, underwriting, risk management, personal injury claims management, as well as new product development. Benton mentioned Google Glass which can capture video footage, pictures, and audio to take statements from witnesses and document damages. A hot topic in insurance is the feedback accumulated by the wearer about the wearer which has already proved useful in documenting a users activity after a personal injury claim in a Canadian court. As it stands, there is a faster adoption rate of wearables outside of the insurance industry and that is where the opportunities lie for insurers and underwriters.