Top insurance market trends for 2023 | Parasol.ua Blog

Top insurance market trends for 2023: what is changing and how it affects consumers

The Ukrainian insurance market is currently being tested not only by the war, but also by general trends inherent in the global insurance industry. And their existence actually depends on how well insurance companies in Ukraine can adapt to these challenges. So, what insurance market trends are currently the most relevant?

IT infrastructure: insurance companies and clients are getting closer

The pandemic, and then the military actions, accelerated an important trend for the Ukrainian market - the creation of IT infrastructure and the use of digital technologies in the daily work of insurers.

For example, purchasing a policy via the Internet is gradually becoming the norm for Ukrainians. Other insurance services have also been moved online:

• the "feedback" function;
• notification of an insured event;
• transfer of documents for payment processing;
• providing medical advice, etc.

In order to implement and improve all this, insurance companies are creating IT infrastructures and restructuring internal processes.

Insurers specializing in online sales are already operating in Ukraine, that is, they do not have an extensive network of branches and do not cooperate with insurance brokers. This approach eliminates intermediaries between clients and the insurer and allows the latter to reduce the cost of insurance.

Artificial intelligence is already in the arsenal of insurers

The development of artificial intelligence technologies may somewhat change the situation on the labor market. In 2023, insurance companies are taking a closer look at this tool and trying to use it in their work. The first direction is to better understand their policyholder and provide more personalized services. The second is to transform complex processes, including underwriting, making payments and helping to detect fraud, obtaining advanced data analytics, etc.

Investments in Ukraine: How Insurance Will Help

Attracting investment to a country where war is ongoing is a task that has become significantly more complicated over the past year and a half. And insurance, according to experts, is one of the ways to change the situation for the better. The experience of other countries makes this a trend and provides the necessary mechanisms. Thus, insurance of investment activities in conditions of military operations is able to provide special institutions. First, we note the national ones, which include insurance agencies. They attract public funds and provide guarantees to national investors.

The second group is formed by international institutions represented by various international organizations, among the most famous of which are the Multilateral Investment Guarantee Agency (MIGA), the Japanese Export Credit Agency (NEXI), the Italian Export Credit Agency (SACE), the UK Export Credit Guarantee Department (ECGD), and the Belgian Export Credit Agency (BECA).

According to the Mykolaiv National Agrarian University, such international organizations are engaged in guaranteeing and insuring foreign investments and export credits. An agreement has already been reached between the Ministry of Economy of Ukraine and MIGA on a pilot project worth $30 million. In parallel, draft law No. 9015 on insurance of investments against war risks has been registered in the Verkhovna Rada. The Cabinet of Ministers and the National Bank of Ukraine are instructed to develop and implement all necessary regulatory documents to make this law work.

Therefore, insurance market trends show that companies are increasingly using the latest technologies to:

• better understand the consumer;
• simplify communication with policyholders;
• reduce or optimize insurance costs;
• remain competitive and continue to fight for the desired place in the market.

On the other hand, the state uses insurance as a mechanism to attract investment to Ukraine, which we really need right now.