The digital transformation of the insurance industry is gaining momentum, by taking into account the growing popularity of machine learning and cloud computing technologies.
Notwithstanding the introduction of these technological enhancements, the overall industry remains mainly conservative still.
Mostly, the inclusion of innovations comes by following the successfully adopted technologies in other spheres. That’s what happened with smart devices, causing the IoT insurance segment to appear.
According to the prediction made by McKinsey researchers, the number of networked devices used globally will reach over 50 billion by 2025. In the given circumstances, there’s no surprise IoT innovations have already entered numerous spheres and industries.
And the insurance sector has nothing but to follow this trend in the near future. Be the first one among your competitors!
Check our overview of the current state and perspectives of IoT for commercial insurance to make a thoughtful move in helping your business catch the trend.
What Is IoT?
The Internet of Things is considered one of the most innovative and interesting spheres in the broader context of digital transformation, considering the wide range of opportunities and applications.
Specifically, these automatic devices can transfer huge data loads, process them in real-time, and react in a pre-programmed way. And all these processes happen with the aim to facilitate your life.
The common examples of IoT are connected cars and smart housing, or the set of technological enhancements to improve driving and living experiences.
All these devices can support insurance purposes, resulting in the industry of IoT in life insurance and auto insurance. Moreover, there exists a wide range of services that include home insurance and IoT.
IoT in Insurance: What Is It All About?
Even though the advantages of smart home devices and health-related wearables are quite obvious, the applicability of IoT solutions in insurance may sound a bit surprising.
Nevertheless, the Internet of Things in insurance industry is already bringing new opportunities to companies.
In general, the devices can introduce enhanced product design, find appropriate distribution channels, and reach more accurate decision-making.
Besides, the IoT innovation in insurance is capable of reshaping the activity of insurance companies in terms of price setting, managing resources, and limiting possible risks.
Since this set of benefits is not yet self-evident for the industry players, it’s highly recommended to introduce the technology now.
5 Key Tasks Assisted by IoT in Insurance
Match customers and applications. The smart approach to adopting IoT is to detect short-term and long-term perspectives, along with extra factors that may affect the dynamics and interests of your target audience segments.
Detect strategic partnerships. The insights gathered by IoT devices can show the weak areas you can empower by developing offerings and partnering with relevant technology providers.
Support scaling. The IoT-powered ecosystem provides the stable ground for managing existing tasks and expanding your business activities.
Process acceleration. Since smart devices are capable of processing tons of data in real-time, this shortens the time for delivering tasks and making decisions.
Ensure long-term competitive advantage. For the generally conservative insurance industry, the smart introduction of IoT technology serves as the hidden strength to outperform your key competitors.
To sum up, the Internet of Things empowers insurance companies in terms of connectivity and opportunity. In other words, this technology architecture unites existing technical solutions in a new way to significantly boost low organic growth rates.
This becomes possible with smart segmentation and proper addressing of customer groups based on their typical behavioral patterns. This, in turn, increases the level of customer satisfaction and loyalty since your clients will get what they really want from you and enjoy better service quality.
8 Applications of IoT Opportunities in Insurance
Here are some successful ways of introducing IoT technology in insurance:
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Facilitated communication with customers. You can apply telematics apps to reach a high level of customer interaction.
Claims processing. Insurers can prevent their income losses by avoiding speculative claims and preventing them from happening.
Developing cross-industry products. IoT devices offer improved tools and can detect the problem areas in insurance. These insights are relevant for creating new services and establishing necessary partnerships.
Smart housing. With the rising popularity of smart housing devices, connected home insurance is gaining momentum. The cooperation models include creating integrated products and offering insurance discounts for the most used devices.
Making flexible pricing models. With the customer data collected, insurers can introduce new pricing models that will guarantee real value-for-money for customers. Moreover, you’ll increase your sales by offering your target audience what it really needs.
Cybersecurity. IoT-enabled risk prevention may come in the form of sensors that protect the physical space or an enhanced capital-to-risk matching for the platforms that are trading insurance packages. For example, IoT for commercial insurance can prevent smoke and mold, mitigating a potentially dangerous event.
Workplace safety. Employees can track their activity with wearables that assist in navigating high-risk areas and warning of a potential hazard on time.
Healthcare insurance and IoT. Connected devices are widely used in medicine, sending alerts to doctors about possible diseases and treatment plan progress. For insurance, this data is used for preventing costly claims connected with severe injuries and disabilities.
5 Main Benefits of IoT in Insurance
1. Risk management
With IoT devices, you will collect direct customer behavior indicators in addition to traditional generalized information about their age, occupation, and residence. They allow getting insights on the frequency of vehicle usage with exact purpose and timing for each case. This way, you can distinguish between high-risk customers and low-risk customers and serve them accordingly.
2. Cost-effectiveness
With the Internet of Things, insurance companies can significantly reduce their losses. This refers to better claims processing and an ability to prevent potential unnecessary expenses in advance. Moreover, the application of IoT telemetry will make your business cost-effective for clients, suggesting customized discounts for drivers and corporate clients.
3. Better interaction with clients
IoT insurance creates the background for establishing stronger customer relationships, meaning improving personal and commercial interactions with your company. The technology introduction contributes to addressing the needs of value-conscious customers by offering a more customized and accurate service package. All this can transform the common perception of insurance services as the “necessary evil” and bring in more worth in your relationship with clients.
4. Empowered branding
The enhancements provided by IoT insurance have an indirect impact on the stronger corporate brand. In particular, it improves the overall service quality and provides the ground for decisions that can help you outperform competitors. This is a true competitive advantage these days due to the strong positions of conservative approaches in the industry.
5. Access to innovative opportunities
With IoT, insurance companies get a diversified data collection tool that is applicable for making enhanced analysis with numerous factors — corporate context, client behavior, location, physical condition, health state, etc. All this information can generate useful insights and become the basis for innovative and accurate decisions.
How and Where to Get IoT Technology in Insurance for Your Benefit
Even though the exact peculiarities of the Internet of Things insurance industry are promising, you should understand how to use it correctly. For taking full advantage of IoT opportunities in insurance, here are the main things to possess:
Sufficient data sources. For proper analysis, your company needs to collect as much raw information as possible. Make sure it’s valid and is relevant for generating insights.
Presence of security controls. Since the ability to manage privacy concerns is critical for IoT insurance, it’s important to elaborate on the data protection in advance. You’ll probably struggle with a traditional vision for insurance organizations on the information closure, but that’s needed.
Establishing trust with your vendor. One of the main obstacles to effective IoT application in insurance is an inability to find the needed tech talents who can introduce this technology in the industry professionally. Therefore, it’s common to mistrust the innovation itself. That’s why it’s highly recommended to find an experienced and reliable tech partner.
The typical software elements for insurance and IoT solutions are:
Risk control tools. The set of technologies includes analytics for checking price insights and linking prices with customer habits. The expected result is lower severity and frequency of claims.
Expenses management. Here, smart devices can make real-time observations and provide timely management of money-related issues. Among the concrete areas checked, there are fraud detection, processes optimization, and command center introduction.
New value proposition. In this dimension, insurance and IoT are linked to reaching greater customer retention. This is made through a diversified set of tools that include a notification center, maintenance alerts, and accurate proposals.
If you’re searching for a software development vendor that works with IoT insurance, refer to Intellectsoft! We’re a tech company with a vast portfolio of successful projects delivered to clients all over the world.
Among our custom insurance software development services, there is an option to request IoT technology for insurance. In this solution, we offer a set of customized smart devices for your insurance company to address your business needs in the most accurate way.
Talk to our experts and get the details on the service. Invest in the Internet of Things insurance innovation in a smart way with us!
The hospitality industry depends a lot on keeping customers happy, but it’s getting harder to attract and keep them. The pandemic hit this industry hard, and now market competition is tougher than ever, with competitive offerings swaying customers. Hospitality businesses are willing to spend big to win customers back. The main questions for many are: how can we stay ahead of the competition, keep our customers, and increase revenue? Keep reading—we’ve got some answers.
Customers today have so many options that getting their attention is a real challenge. It’s not easy to make them choose your business over others. What worked 10 years ago doesn’t work the same way now. Back then, people often chose businesses based on reputation. But with new types of businesses (boutique hotels, craft cafes) popping up or big enterprises getting a new strategy, expectations have changed. The good news is these businesses have shown what works: great customer service. They focus on personalizing the experience, making things easy for customers, offering loyalty programs, and using smart technology.
In this article, we’ll explore these tech strategies and show you how they can help your business grow, and double the revenue. Keep reading to learn more!
The Importance of Customer Satisfaction in the Hospitality Industry
Customer satisfaction, which equals exceptional customer experience, is the backbone of the hospitality industry. It plays a central role in driving revenue and loyalty, as satisfied customers are more likely to return and recommend a hotel, restaurant, or other hospitality business to others. In fact, a study by the Harvard Business Review found that a 1% increase in customer satisfaction can lead to a 0.5% increase in revenue. Moreover, loyal customers are more likely to forgive mistakes and continue doing business with a company, even if they experience a negative encounter.
Let's quickly review the challenges the hospitality industry is facing right now so we can move on to the solutions and our case studies.
Challenges in Hospitality
As businesses navigate the changes in the hospitality industry, there are some key areas where a little improvement can go a long way. From improving customer service to embracing digital transformation and tackling labor shortages, we’ll take a closer look at today’s biggest challenges—and, more importantly, how technology can step in to help. Let’s get started!
Poor Customer Service
Even with strong and high-quality business offerings, poor customer service can drive potential customers and existing customers away. Common issues include:
Long wait times in customer service queues (it is worth remembering that our attention spans 8 seconds, and we live in a very busy world, so quick and efficient responses are more important than ever.)
Poorly trained customer service representatives
Lack of follow-up
Services not being done properly or quickly
Recall issues that require multiple service calls
These problems can frustrate customers. But, at Intellectsoft, we believe that the right approach, combined with technology, can address them effectively.
Digital Transformation Gaps
Approximately 50% of hotels are adopting new technologies, with 43% automating repetitive tasks and 39% upgrading existing systems. Source: workstaff.app
While many businesses are adopting digital solutions, some still struggle with outdated systems and fragmented data. Legacy companies often face chaos when trying to manage their data and create new systems or add features.
Some of the recent examples include clients coming to us to create AI solutions for their services while their data simply was not ready for the advanced tasks. We advise stepping back, communicating with a company objective, and working on keeping the data clean (centralized, structured, and segmented).
When we’re asked to create advanced systems using AI, we always emphasize the importance of organized data. To train AI and build such complicated systems that truly work, you need to start from the very beginning—collecting, storing, centralizing, and organizing it. We encourage our clients to align all departments to work internally on the data so we can create a unified digital system that delivers personalized experiences.
If you’re unsure where to start with your data, we can help. Collecting feedback at various touchpoints along the customer journey is crucial for gaining insights into customer satisfaction and loyalty. Book an IT consultation with us, and our experts will guide you in mapping out a path to get more from your data and build a system that works for your business and team.
Reskilling Staff
The pandemic hit hard in early 2020, especially for the hospitality and travel industries. Even five years later, many businesses are still feeling the impact. Recruiting and retaining skilled staff has become a major challenge post-pandemic.
Reskilling to address technology’s impact is of utmost importance, as about 40% of hotel General Managers place it among their top three workforce challenges.
We strongly believe that adopting the right technology can help. For example, creating an app to train your staff not only saves time but also ensures consistency in learning. AI assistants can also work alongside your team, helping with tasks like recruitment (providing industry insights, crafting emails) and staff training. Imagine having an app dedicated to making your team’s work easier and more efficient!
How Technology Tackles These Challenges and Supports a Customer-Centric Hospitality Culture
Automation, AI, and similar technologies may threaten many. However, the debate about replacing humans isn’t about that—it’s about cooperation and working hand in hand with technology to achieve the highest standards and establish brand-new “golden standards.” Technology is here to assist staff in listening to and collecting customer insights from data.
Let’s review some of our cases to see examples of how technology helps improve customer experience and supports customer service.
Examples of Intellectsoft projects
Property management systems (PMS)
We created a web platform and mobile app that makes managing daily tasks easier and offers extra services to improve residents’ experience. It gives a clear overview of daily activities and helps with managing units and users. Residents can easily book amenities, submit service requests, and report incidents. The platform also includes features for equipment management, key instructions, workflows, and custom permissions. This makes it easier for staff to stay on top of equipment and ensure residents have all the information they need. Plus, tools like announcements, quick votes, a forum, and a community calendar help build a connected and engaged community.
Guest Experience Management App
Our next app helped our client improve their guest experience by replacing printed marketing materials and the need for phone calls with a smart solution. Now, guests can easily order in-room dining, make reservations, and interact with staff— through a simple tablet in their room. The solution includes three parts: a custom in-room tablet with a variety of services, an admin panel for hotel staff and service providers, and a backend system that connects everything together. This approach makes things easier for guests and staff, improving both convenience and efficiency.
Existing Customers First: Building Loyalty with Personalized Touchpoints
Keeping existing customers is not just a strategy; it’s well-known that retaining existing customers is more cost-effective than acquiring new ones. In fact, research shows that it costs five times more to acquire a new customer than to retain an existing one. KPMG named customer retention as the number one revenue driver for the company.
Moreover, a 5% increase in customer retention can lead to a 25% to 95% increase in profits, showing the significant impact loyal customers can have on a business’s bottom line. Retention strategies, like personalized experiences and loyalty programs, can foster long-term relationships and generate recurring revenue, ultimately making them an invaluable part of any business model.
Personalization: How Technology Can Help?
Everyone loves to feel special—it’s part of being human. In hospitality, personalization has evolved from being a luxury to an essential standard. With the right technology to manage your data effectively, you can deliver those “wow” moments that guests won’t forget.
More than half of hotel chains are already using personalization features on their websites, booking platforms, and apps, and another 39% are planning to follow suit soon. They’re tailoring experiences to fit guest preferences perfectly.
Source: Deloitte
How does technology make it happen?
CRM Systems: They help you keep track of guest preferences, booking history, and special requests so you can offer services tailored just for them.
Loyalty Programs: Personalized rewards and offers show your guests that you value them, keeping them coming back for more.
AI Personalization: AI analyzes guest data to predict what they’ll love (from room upgrades to local recommendations) before they even ask.
IoT Gadgets: Smart room features like voice-activated assistants, or temperature controls adjust to your guests’ preferences, making their stay more comfortable.
With tech-powered personalization, you’re building loyalty and maximizing the lifetime value of every customer.
Our Case Study: Smart Hotel Management & Loyalty Program
For one of our clients, we created a smart room solution, complete with a custom IoT system. Guests can use a mobile app to control services, explore amenities, and find resort information-- with a special touch to their suite type. For the client’s entertainment business, we improved their legacy software by running a full IT and code check, fixing issues, and making the system better for customers.
Along with that, we developed a mobile app for the loyalty program, allowing businesses to effortlessly reward their customers and keep them engaged with exclusive benefits.
Our solutions not only helped the client with special experiences for guests; it also improved operations, cutting costs by eliminating inefficiencies. Here's what our experts shared:
"We transitioned away from ESB (Enterprise Service Bus) systems, which previously cost millions, and replaced them with more efficient, self-managed solutions. Similarly, we’ve implemented Device Farms that improved operations and saved resources."
Leveraging Software to Increase Upsell Opportunities
Here are some examples of tech tactics that will help your team sell more and introduce new offerings to existing customers, improve overall efficiency leaving your team grateful:
Dynamic Pricing Algorithms
For finance and marketing teams, manually calculating pricing by segment to introduce your clients can be incredibly challenging. AI-powered tools can strongly optimize these strategies by analyzing your database in detail.
Upselling via Apps
Boosting revenue in the hospitality business often comes down to personalized experiences. Imagine this: a guest books a room, and then your app suggests a spa package or a room upgrade at just the right moment. Later, it nudges them to book a dinner reservation or a guided tour designed to their preferences. With apps offering these personalized recommendations during and after bookings, you’re not just increasing your revenue per guest but also skyrocketing their experience. And you do it in a sustainable way, not by speculating, but by offering what your customers desire based on their previous experiences. It’s a win-win: seamless, helpful, and far from pushy.
Inventory and Resource Management Software
Making every resource count in your hospitality business is key. Inventory and resource management software allows you to effortlessly track everything from linens to room availability, ensuring nothing goes to waste. Having real-time insights to reduce overstock, avoid shortages, and optimize operations assists sustainably keep everything under control and know what you need to focus more. It helps maximize room occupancy by aligning bookings with available resources, ensuring every room and item is used effectively. This approach leads to smarter management, better guest experiences, and a noticeable boost to your bottom line.
Adopting these strategies not only optimizes your operations but also drives business growth. Ready to discover how technology can elevate your goals? We’re here to create a tailored solution for you.
Steps For Implementing a Customer Service Technology Solution
Improving customer service in hospitality doesn’t have to be a daunting task. With the right technology, you can smooth the path of your operations, speed up response times, and elevate the overall guest experience. Here’s where you can make it happen:
1. Understand Your Needs
Start by identifying the challenges your business is facing. Are you struggling to manage high volumes of inquiries, track customer feedback, or personalize the guest experience? Pinpointing your needs will guide you to the best solutions.
2. Pick the Right Tools
Choose technology that aligns with your goals. Look for solutions that are scalable, easy to use, and integrate effortlessly with your current systems. Options like CRM software, live chat tools, or a guest experience app can make a difference.
3. Equip Your Team
Technology is only as effective as the people using it. Train your staff to make the most of the new tools, so they can deliver exceptional service and resolve issues quickly. Confident, well-equipped staff creates happy, loyal customers.
4. Keep Improving
Once implemented, monitor how well the solution works. Are response times improving? Are customers more satisfied? Regular evaluations will help you fine-tune your approach and keep things running harmoniously.
Some Tech Ideas for Hospitality Businesses
CRM Software: Manage customer interactions and preferences.
Guest Experience Apps: Delight guests with personalized experiences right at their fingertips.
Amenity Management Systems: Simplify operations for everything from room service to facility bookings.
Live Chat Tools: Offer instant support and answers.
Social Media Management Tools: Keep customer interactions engaging and organized.
Integrating these strategies will not only improve your customer service but also deliver unforgettable customer satisfaction, loyalty, and, ultimately, your bottom line. Ready to take the next step? Book a consultation with our experts.
Conclusion
To wrap up everything we've discussed, customer satisfaction and experience are at the heart of hospitality. Retaining customers is more than just keeping them around—building strong, long-lasting relationships and consistently meeting their evolving needs. By understanding their pain points and offering personalized solutions, you can inspire loyalty and drive progress. With the right technology and continuous improvement, your business can stay ahead, let go of what no longer serves you, and keep growing.
At Intellectsoft, with over 17 years of experience in software development, our expert team is ready to help. We create everything from mobile apps to full-fledged portals and systems, leveraging the latest technologies like AI, Cloud, and Machine Learning. With deep experience in the hospitality industry, we’re here to craft personalized solutions that bring your business unforgettable customer experience and retain your valuable clients.
Ready to double your revenue and level up your customer retention strategy with personalized technology? Contact our experts, and we look forward to working hand in hand with you to build or revitalize the perfect app or system for you.
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