5G: The Controversial Tech Revolution That Will Disrupt The Insurance Landscape

25 Sep 5G: The Controversial Tech Revolution That Will Disrupt The Insurance Landscape

Tech around the world is getting ready to level up with the imminent rollout of super fast 5G connectivity. As this innovation dawns across the world and begins to revolutionise our cities and businesses, we take a look at how 5G will affect the insurance industry. 

The Benefits of 5G and Related Insurance Shifts 

5G is predicted to be a catalyst to enormous technological advancement. The reason? Sheer speed and incredibly low latency. 5G will allow faster data transmission than we’ve ever experienced. In one test, the Chinese company ZTE achieved speeds in excess of 19 Gbps. This means communication will be (or extremely close to) instant. Every industry is bound to experience vast improvements in communication infrastructure, which will herald better integration in business. 

Integration Leads to Real Time Action

A few examples of 5Gs biggest applications include real-time production inspection and assembly line maintenance in factories, monitoring and optimisation of many aspects of agriculture which will revolutionise farming and real-time shipment tracking of commercial goods. All these improvements and live data monitoring capabilities can be utilised by insurers.

Transformation in Transportation

Our roads will probably see a big uptake of self-driving and ‘intelligent’ cars that can communicate with other vehicles and objects as 5G establishes, as the low latency provided by the 5G network is essential for accident-proof vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) processes. Car insurance looks set to be transformed, as our future vehicles gain the ability to generate real-time crash data that can be instantly transmitted to the emergency services as well as to insurers for faster and more accurate claim resolutions. 

‘Intelligent’ cars on the 5G network grid that can transmit information give a new meaning to the term ‘gridlock’.

Life (and Money) Saving Applications

In the case of road accidents, 5G’s rapid response potential may end up saving lives. 5G will also affect emergency services and the healthcare industry as a whole. Smart smoke-detectors could alert both fire brigade and your property insurer in case of a fire, for example. At the Mobile World Congress 2019 in Barcelona, a similarly life-saving use of 5G was demonstrated: surgeons are able to guide a live operation in a hospital miles away using 5G communication. The low latency of the connection is vital in such innovations.

Live patient monitoring is another eagerly anticipated application of the technology, as well as enabling the aid of virtual reality (VR) in medical training. For insurers, 5G means improved data sharing by healthcare providers as well as between insurers and the patients themselves to calculate premiums and resolve claims more accurately. Public encouragement to embrace tech like fitness tracking devices to help calculate health insurance premiums is likely.

The Rise of IoT: Smart Homes and Smart Cities

Connected buildings, energy grids and smart IoT (Internet of Things) devices will alter the insurance landscape drastically.  Innovative repair services will grow, both for the home and for city infrastructure in general. It’s not too far fetched to envisage appliances that automatically call for maintenance and submit an insurance claim in the near future. This may even extend to personal electronic device insurance. A ‘smart’ energy grid will be adopted by tech savvy cities, which will no doubt affect home insurance policies.

5G will enable most major cities to become hyper-connected Smart Cities 

Finally, the way we handle transactions will continue to evolve. Digital payments using our devices are already widespread, but it could be the case that 5G enables instant payments across borders, shaping a new future for international banking and finance. The scope of potential change offered by 5G is limitless, and the biggest payoffs of 5G will be breakthroughs we can’t even conceive of yet.

5G: An Ambivalent Advancement

However, the advent of 5G is highly controversial. Despite the inevitable leap in technology humanity will experience when the network is in full force, and the unprecedented benefits this may lead to, the consequences of 5G may also include sinister ones. 

The Darker Side of 5G and its Effect on Insurance

Firstly, there are major health concerns regarding the high-wave radio-frequency radiation (RFR) that will soon bathe our cities. In order for 5G to work effectively, the network requires thousands (or even millions) of small-cell towers and antennas to be constructed in close proximity to each other. This is because the high-frequency millimetre waves (MMWs) that are needed for the network to reach it’s hyper fast speeds only travel a short distance and easily experience interference from buildings, vegetation etc. There is no telling how this constant exposure to RFR will affect our health and natural environment, but many experts are fearing DNA damage and cancer risks. 

The sheer number of 5G transmitters that will have to be set up for the network to function has caused some alarm.

Secondly, cyber risks will escalate. Unfortunately, 5Gs super fast download speeds mean that hackers can take advantage of stealing vastly more data in a much, much shorter time. The greatest benefit of 5G will present an equally great risk. Insurance companies will not only have to tighten their own cyber security measures but will see a jump in the demand for cyber risk policies from a myriad of industries. There will be a shift in product liability insurance, especially on devices operating under IoT. IoT devices are already vulnerable to security breaches, and this will only worsen with the seamless connectivity and communication potential offered by 5G, which will be easily exploited, unless device manufacturers start implementing more robust protection.

How Insurers Can Prepare For 5G

As any professional knows, success lies in preparation. Insurers should be analysing existing models and assessing how they can adapt to make the most of this wave of tech advancement. The uptake of the network to adequate working standard will still take a couple of years, but it is essential to future proof plans and foresee change on an enormous scale.

For insights on how to be a forerunner in the field as 5G rolls out, professionals can get in touch with leading insurtech experts i-surance here.