Is VR the future of insurance?

Loss Adjusting

Virtual reality (VR) is increasingly breaking into our everyday lives. As a genuine tool for boosting productivity, it will have significant impacts on all business sectors, including the insurance industry, in the coming years. But, among insurance companies, VR raises several questions in relation to risk prevention, training and techniques. Our NICT loss adjuster, Georges-Eric PFISTER, attempts to shine some light on how this technology will affect and interact with society.

Is this just fantasy?

Virtual reality places the user within a digital simulation of a computer-generated environment. Depending on the device used (glasses or helmet), the user can take in a virtual world through their different senses (sight being the most obvious but touch, hearing and smell can also be stimulated). Furthermore, interaction with the virtual world is improving all the time. This technology enables a person to immerse themselves in a situation and carry out a sensory-motor activity in an artificial world. To ensure complete immersion, the VR headset employs a 3D stereoscopic projection to place the user in the midst of a computer-rendered world. 

Virtual reality in insurance

In coming years, the world will certainly see this technology become more commonplace in all business sectors, which will create new risks of accidents and public liability. If a surgeon is performing a remote surgical operation through a VR headset and the connection is cut because tram works near the hospital severs a fibre optic cable or even just because the telecommunication lines go down, who should the surgeon turn to? An emergency backup, for example over 5G, will be essential to reduce risks and could become an indispensable prerequisite at the time of looking for insurance. 


In a world that is completely changing, the insurance market is adapting to the evolving risks. Risk managers will now have to consider new details to ensure a company can continue doing business. Insurance costs could very well depend on whether training has been taken remotely or in person. Car insurance premiums may end up higher for a driver who practised on a simulator than for one who had their lessons on the road. 

A prevention tool to help policyholders and insurers

Despite the risks, VR is an excellent prevention tool for insurers and their policyholders. For example, it could be set up to place a prospective client in a simulated incident that highlights the damage caused by flooding, a fire or car accident. It would be an immersive experience where the client could be shown the different options available in a multi-risk insurance policy and how each option would cover their business. Another example of its use would be to portray an incident in each room of a virtual factory or warehouse and then present a product list in augmented reality detailing the coverage offered by the insurance policy. The customer could view all risks with a VR helmet on. 


Likewise, online claims management would allow a policyholder to use a specific application to contact their insurer directly. A claim investigation could be performed in real time with the report of tangible damage and photographs of the damage being sent to the insurer who can immediately respond. Augmented reality is notably adapted to simplify compensation claims. 

Virtual reality can also be used to train underwriters through total immersion, like the flight simulators used in the aviation industry. This technology lends itself to the remote training of staff in virtual classrooms and can be used for one-on-one or group lessons. Sales teams can similarly be trained through technology based on artificial intelligence or machine learning. For on-site appraisals, we can well imagine less experienced loss adjusters relying on this technology as a guide through each step of a loss assessment and getting in touch with a specialist if need be. However, the real question is whether this tool can actually replace genuine experience that is acquired on the ground in person. If distance learning offered a comparable quality to face-to-face learning, television would have had a monopoly already on this area of our lives. Acquiring knowledge, mastering a technique, putting skills to practice in real life all require long hours working with fellow learners and experts.  



Any time a new technology arrives on the scene, it is not uncommon to see new risks emerge too. Virtual reality is no exception to this rule. While it is still difficult to quantify its impact on the insurance sector, it is a nascent technology that promises to greatly change society. Although societal impacts obviously need to be considered, the digital transformation of the entire economy cannot be ignored in the least. In fact, information security becomes more crucial as digitalisation and the use of new digital tools and data become more prevalent. Despite all the preventive measures that can be put into place, no information system is perfect. That is why there is a desire to establish a reliable, effective detection system.  


Georges Eric PFISTER – NITC Risk Loss Adjuster 

Stelliant Loss Adjusting