Apparently more than 400 insurance-related patents were filed last year with the use of mobile devices a key trend. While insurance as an industry may have lagged behind others in embracing technology, that’s no longer the case. The industry has become a hotbed of innovation as both insurers and intermediaries search for new ways to differentiate their products and services.
But while the race is well and truly on to embrace new technologies, we can’t ignore the risks that go alongside it.
The Financial Conduct Authority is studying the potential risks to customers of mobile banking which is fast gaining pace, so you can be sure that they’ll be keeping a close watch on how insurers and intermediaries develop apps enabling customers to check quotes, amend policies, make claims and the like. I just hope that they don’t stifle innovation in their quite valid efforts to ensure that consumers are appropriately protected.
But who is watching over our businesses as we look to become more efficient in how we do business, in making it easier for our partners and customers to work with us, and to differentiate our offering from others?
Back in April, research by the Department for Business, Innovation and Skills found that 87% of small businesses in the UK suffered some sort of security breach. The average cost of the worst security breach amongst smaller organisations was between £35,000 and £65,000 – hardly small change!
Just as intermediaries should make their customers aware of the growing trend of cyber criminals targeting their customers through phishing scams and ‘vishing’ – the growing problem of telephone scams, they should also ensure that they’re doing all they can to protect their own business from cyber attacks.
Cyber crime has many different faces and the internet has made it easy for criminals to launch a broad attack snaring many victims. I don’t know if you saw Channel 4’s ‘Blackout’ aired earlier this month, but that highlighted the impact a cyber attack could have on the utility grid. Now an attack of this sort is out of the control of your average UK business, but there are a few simple things that businesses can do to mitigate some risks.
These include the obvious steps such as password protecting all computers, mobile phones and tablets, using firewalls and updating anti-virus software, and encrypting sensitive data. But there is also the obvious step of using known providers for any new technology that we take on board. The Source, for example, recently launched our e-docs facility providing intermediaries with a secure, online portal for client documents. We’ve been around for 20 years and I’d like to think we’re a trusted source!
Failing to embrace the benefits that technology can deliver could result in failing to meet the demands of our customers. However we need to be careful who we cosy up with and how we do it to avoid catching a nasty virus.
Kevin Paterson is managing director of Source Insurance
Twitter: @sourceinsurance