There is a lot of attention around Fintech at the moment. However, many people mistake this for Insurtech (or insurance technology). With new companies flooding into the space looking to get a piece of the pie and investors desperate to find the next unicorn, there are a few things you should know about what is happening behind the scenes.
Even though the name suggests that these are different industries, people don’t know the actual difference. With the thin line that defines their work areas, the Fintech and Insurtech industries are intertwined by common people.
If you are interested in knowing about the differences between these two technologies, you are at the right place. This informative post breaks down some of the fundamental differences between Fintech and Insurtech and how they relate to one another.
What is Fintech?
Fintech is a term used to describe the technology in the financial sector. This can include anything from mobile banking to peer-to-peer payments. Fintech is often used to refer to companies that offer these services rather than the technology itself.
Fintech has become increasingly popular as more people move away from traditional banking methods. This can be attributed to innovations like Bitcoin, the emergence of the crypto-currency, and a series of massive heists from major banks that have created an increased appetite for more security and anonymity while making payments.
What is Insurtech?
A term used to describe the application of technology to the insurance industry is called Insurtech. It includes the use of big data, mobile technologies, cloud computing, and artificial intelligence. Insurtech is used to improve the efficiency and effectiveness of the insurance industry. It can be used to improve the customer experience, make it easier for customers to buy insurance, improve the speed and accuracy of claims processing, and improve the underwriting process.
The most promising use of insurtech is the use of big data to develop models that predict which claims are likely to be fraudulent. Today’s industry is characterized by underutilized data and a complex regulatory environment. Technological advancements and business model developments can combine to create an insurtech industry that leverages the potential of big data and artificial intelligence to improve both insurance protection and claims processing.
The Difference between Fintech and Insurtech
Fintech is focused on improving the financial services industry, while insurtech is focused on improving the insurance industry. Fintech companies are typically focused on developing new technology solutions to make it easier for people to manage their money and finances. Insurtech companies are typically focused on developing new technology solutions to make it easier for people to buy and manage insurance policies.
While the Fintech industry is helping the customers directly by providing seamless solutions, Insurtech is helping the customers and the companies themselves to reduce the paperwork and provide convenience. Fintech and Insurtech startups are entering the market at different times and are competing with each other. It’s important to remember that both industries are focused on reducing cost, simplifying processes, and improving the customer experience.
Technology is the future, and everyone knows that. With the latest trends, the companies are riding the waves and choosing the technology to make their lives easier. With Fintech and Insurtech, the same is happening.
Startups are focusing on both of these technologies and providing people with ways to protect their assets, invest in safe instruments, get a loan or insurance in a hassle-free manner.