Role of Advanced Analytics in the Process of Factory and Warehouse Insurance

Highlights

• Introduction
• Role of advanced analytics in factory and warehouse insurance
• Recent collaborations in the sector

Factory and warehouse insurance is a type of insurance policy acquired by factory owners to protect their facilities from potential financial losses resulting from adverse events such as thefts, fires, electrical fires, acts of terrorism, and similar incidents. Acquiring a factory and warehouse insurance policy provides financial protection for the businesses and grants peace of mind to business owners, assuring them that their valuable assets are shielded from a variety of potential risks.

Factory and warehouse insurance offers different coverage options such as replacement & reinstatement policies, specific policies, valued policies, and floating policies. A floating policy is necessary to cover assets that are not tied to a permanent location and bridge the gaps in traditional property insurance coverage.

Floating policies offer significant advantages for businesses engaged in extensive imports and exports or those with frequently relocated equipment or inventory. These policies provide comprehensive coverage for their dynamic asset base, ensuring protection against various risks. Owing to these factors, the floating policy segment is estimated to generate absolute revenue growth of $17,692.07 million by 2032.

Advanced analytics for risk assessment in factory and warehouse insurance

Advanced analytics empowers insurers to gain deeper insights from the vast data of their global operations and customer demographics. Through extracting unique insights, insurers revolutionize their business models to the advantage of their customers. This includes cross-selling efforts, the management of claims & underwriting processes, and enhancements in pricing strategies. 

Insurers have adopted innovative analytics approaches and visualization techniques to augment their internal capabilities and discover new services, products, and customer experiences. Insurers effectively manage risks and maintain price stability with advanced analytics, which empowers them to establish precise premium pricing.

Asia-Pacific factory and warehouse insurance sector leads the industry

Businesses in the Asia-Pacific region increasingly seek comprehensive insurance solutions that address a wide range of risks, including business interruption, liability, and property damage. Moreover, the manufacturing and logistics sectors in the Asia-Pacific region have witnessed rapid expansion, resulting in a surge in the number of factories and warehouses in need of comprehensive insurance coverage.

Businesses in the region have become more aware of the potential threats, including natural disasters and supply chain disruptions, which drive the demand for factory and warehouse insurance. Among the developing countries in Asia-Pacific, India is estimated to display a noteworthy CAGR of 21.6% from 2023 to 2032.

Exploring strategies adopted by top entities to dominate the sector

The global factory and warehouse insurance industry has gained momentum due to business interruption risk, increasing the risk of burglary and theft, and a surge in property damage incidences. To sustain the dynamic industry, frontrunners have adopted novel strategies including new product launches, collaborations, mergers, partnerships, and acquisitions. For instance, a leading AI-driven auto insurance technology firm, Roadzen, and a prominent global technology company, HCLTech, joined forces in December 2023. This partnership aimed at leveraging AI and data engineering to bring advantages to both auto insurance carriers and their customers. This collaboration seeks to assist auto owners in enhancing safety, lowering insurance premiums, and preserving the value of their assets. Moreover, it is projected to provide carriers with enhanced insights into driver behaviors and help improve loss ratios.

Similarly, OnTheMarket entered into an exclusive partnership with insurance broker Simply Business in November 2022 to introduce four new insurance products to its portal's agent customers. The Group has obtained clearance to introduce Simply Business and its products to its agent customers following a successful application to become an IAR (Introducer Appointed Representative) for the broker. Moreover, the partnership is expected to offer OnTheMarket’s agents greater flexibility to compare their current insurance policy benefits.

To sum up, factory and warehouse insurance is a policy obtained by factory owners to safeguard their facilities from potential financial losses caused by adverse events such as fires, thefts, acts of terrorism, electrical fires, and similar incidents. Moreover, the integration of advanced analytics in factory and warehouse insurance processes empowers insurers to gain deeper insights from the vast amount of data with their global operations and customer demographics.

For a detailed projection of the global factory and warehouse insurance industry, feel free to contact us

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