Ed Kelly, President & CEO of the American Association of Insurance Services (AAIS), speaks with WRIN.tv about data and technology, ‘price optimization’, and new product development. Mr. Kelly sees two sides to the data issue: how to protect it, and how to use it appropriately in a business like insurance, including price optimization.” He acknowledges the regulatory debate over price optimization. He notes the move from cost-based rate making to customer-sensitive pricing id relatively new to insurers in the admitted market, but familiar to the surplus lines market. And while drones are a fast-growing, emerging issue, he sees the risk being around for quite some time.

Mr. Kelly says the insurance industry continues to be the leader in IT spend, particularly per employee. He says beyond the price optimization discussion, he expects more focus on the use of data in more effective marketing, sales and distribution of insurance. He says AAIS members spend a lot of money on IT. He’d like to see the focus on ease of doing business and customer service. He discusses AAIS’s recent launch of an underwriting platform that can be integrated into “any policy administration system.”

Mr. Kelly expects innovation surrounding drones, data and distribution. He sees drone technologies moving from “hobby-like vehicles” to larger unmanned vehicles such as driverless cars, trucks, planes and trains. Concurrently, he believes the focus of risk coverage will move from operators to manufacturers. AAIS sees a lot of applications in the farm and agricultural sector.

In closing, Mr. Kelly compares the introduction of Google in the insurance to the entre of new players in mortgage and banking. He acknowledges the importance of Google’s entrance given their regular interface with customers.

For more from the 2015 NAPSLO Convention, visit the WRIN.tv On Demand Library.

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