The new digital and virtual universe is presented as an opportunity to explore new insurance businesses and even to get closer and ‘hook’ the new generations.
The metaverse is a new digital environment where users and companies can interact by removing physical and temporal barriers. Insurance companies can also find a world full of business opportunities in this space. However, if they decide to enter it, they must respect and pay attention to the different risks and dangers that arise in this technological framework.
What is the metaverse?
The metaverse is a virtual world, which is accessed through different electronic devices. In addition, users can interact with various elements, thanks to virtual reality glasses or other accessories. However, virtual worlds are not new concepts, since for several years there have been large numbers of video games that imitate this sensation. Lovers of online games have been creating their own characters or avatars for decades and entering parallel worlds through the computer and mobile.
However, the metaverse does not seek to create a fantasy world, but rather a kind of alternative reality in which the same activities can be carried out as in the real world, but without moving from the same place. The term metaverse was born in 1992, exactly in the novel Snow Crash, by Neal Stephenson, and it is a concept that has settled over time thanks to three-dimensional and virtual innovations. The current metaverse, therefore, gives its name to a virtual world in which one can interact and recreate a reality similar to the external one.
In this sense, the precise concept that the giant Facebook and other technology companies are betting on is the idea of creating a parallel universe. The key to the success of this metaverse is that it can be totally immersive, through sensors that record physical movement to advance with the avatars.
Another of the essential issues of the metaverse is that the user has total freedom of creation, that is, he can create his avatar as close to his physical person as possible. This fact also affects businesses, rooms, homes, locations, etc., everything can be immersed in the virtual environment of the metaverse, including insurance.
The metaverse is still a blank canvas, all the benefits and dangers that the metaverse can offer are really unknown, but some technological scholars have ventured to devise some possibilities of this new virtual environment. In its most positive view is Facebook.
The social platform hopes that the metaverse can offer the same opportunities as the physical and real world, with the possibility of creating new businesses, micropayments and even an economy of its own. Also, it raises the perspective of designing practical applications, in this way, the real world would be facilitated. For example, work meetings could be held in virtual offices without the worker moving from home.
The most repeated question among the digital masses is, when will the metaverse be real? Currently, there are already tests and games that broadcast the metaverse concept, as is the case with Bloktopia, Zepeto or The Sandbox. Despite these advances, there is still not enough technology to make the final notion of a metaverse a reality. The entire infrastructure is missing in terms of design. This universe to be created does not yet have regions, towns, or streets, only small virtual rooms that are being used as a test. During the next few years adaptations and tests of virtual reality will emerge on mobile devices.
Opportunities for the insurance sector
The arrival of the metaverse can be a great window for brands, without a doubt, a commercial space with high potential to interact directly with consumers. In this context, the metaverse can become a business opportunity for insurers whose main goal when betting on this digital universe is to reach a larger audience and even focus on a younger target.
Traditional marketing methods fail to attract the youngest, Generation Z is looking for more complete virtual experiences. Therefore, insurers must focus their objectives on achieving a greater number of interactions. Similarly, gamification to reach young audiences is crucial as they are used to having digital experiences and need amazing ideas to grab their attention.
It is true that the digital transformation in the insurance sector is gradually being dynamically introduced into sales and marketing campaigns. But after the arrival of the metaverse concept, insurance offers a new business opportunity. This commercial paradigm will lead insurers to be part of a new space to work, capture sales and invest.
Thanks to the metaverse, insurers can achieve a continuous presence. In addition, by prolonging social life alongside professional life, users will explore a greater number of areas and content, therefore, the insurance sector must strive to create quality content. Similarly, the metaverse is primarily designed as a reactive environment to create real-time interactions between users. Therefore, insurance companies must strive to move conferences, meetings, product presentations, etc., in this new digital environment.
On the other hand, there are no limits to the metaverse, there is no maximum number of users, experiences or worlds, therefore, insurers have a wide paradigm of possibilities to explore. However, users and Artificial Intelligence will be active creators of the metaverse, in this sense, insurance companies have to be fully prepared for a rapidly changing environment.
Is the metaverse safe? Associated risks
Because it is a new technology, there are no long-term studies on the true implications that users and companies that enter the metaverse may suffer. Due to its digital nature, actions in the metaverse scenario translate into personal, biometric, financial and even emotional data, therefore, insurers must be concerned about the security and confidentiality of their procedures. As the popularity of this digital environment grows, so will the potential for cyber attacks.
On the other hand, avatars replace personal identification, therefore, personal data can be copied, stolen, deleted and manipulated. In this context, insurance companies must increase security when creating personal insurance for new clients through the metaverse, biometric identification is a solution to prevent identity theft and thus avoid risks.
In conclusion, the insurers with the greatest digital intrusion and innovative processes will be the ones that lead this new commercial and social environment. In addition, companies will be able to capture more customers than ever before, due to the size and relevance of the metaverse. To achieve success, they must have technological resources that provide a comprehensive digital service.
