As a result of growing trends and digitalization, the insurance sector in the CEE region is developing quickly. In this article, we will look at how digital innovation and insurtech are affecting how insurance products are distributed, as well as the rules and data that are relevant to all of this. Automation and artificial intelligence (AI) are increasingly being used in insurance companies as the business develops. However, these adjustments also bring with them difficulties, such as navigating the regulatory environment and having access to crucial data. This article seeks to inform and educate on the current condition of the industry and where it's headed in the future as the CEE area quickly catches up with the rest of the globe in terms of digital innovation in the insurance industry.
Emerging Trends and Regulatory Perspective
Despite the epidemic, 25 billion euros were invested in a European Insurtech start-up market last year. In 2021, 13 of the Insurtech agreements took place in the product development space. There are nine on underwriting, 53 on distribution, and seven on claims. All these investment opportunities must become a reality and a success. The financial services law must be innovative and digitally friendly. To be appropriate for the digital era and stimulate digital innovation, it must be technology-neutral and future-proof. Unfortunately, there are still regulatory impediments to offering insurance to customers online. For example, the paper requirements utilized by the insurance distribution director are valuable to mention here. The simple conclusion is that the more specific the regulatory standards, the better.
In the end, the more precise the regulatory requirements, the more difficult it is for the financial sector to innovate. Another example is the GDPR, where some of the regulations create legal ambiguity and hinder the use of blockchain technology. Second, regulatory criteria for new service providers entering the market, such as Insurtech start-ups, are frequently less stringent than for those already in the market. In terms of access to data and data monopolists, creating a level playing field among all these stakeholders—insurers, new market entrants, start-ups, and major IT giants—will be critical in the future. Improving data access, processing, and sharing regulations in order to foster innovation and competitiveness.