Ways AI can transform The Insurance Sector
Apr 27, 2021
AI in Insurance Sector
As insurers investigate its potential and come to grips with its risks, Artificial intelligence (AI) is becoming an important technology in the insurance sector. To benefit most from AI, insurance companies need to re-think their approach toward their existing processes and data.
AI has the potential to disrupt the insurance sector and greatly improve the customer experience. With growing customer expectations and competition, insurers must find new ways to drive product innovation, improve operational efficiency and transform customers & experience.
Future of AI in Insurance
Insurance companies have realized the need to unveil and innovate areas where AI can be applied. They now embrace AI to be more effective in driving strategic business goals and customer engagement. The benefits arising from its use—including better risk models, new products, cost savings — will force insurers to adopt AI technologies to compete.
Intelligent automation is replacing repetitive manual tasks across the insurance sector, redefining existing processes, and improving interactions with customers. But, to get the most out of AI, companies must follow a strategy that augments the human workforce. They must evolve in terms of how they work, from basic robotic process automation (RPA) to AI-powered intelligent decisions.
Insurance companies are using AI technologies like Chatbots & Virtual Assistants, Robotic Process Automation (RPA), Machine Learning, and Natural Language Processing (NLP) to identify gaps in customer needs. These latest technologies are helping insurers increase efficiency and drive down costs—by automating underwriting, claims processing, and customer service.
1. Customer Service
AI-powered chatbots or virtual assistants can enable customers to interact directly with the business through human-like conversations and address their questions in a more personalized manner. With the ability to deep dive into the data models, chatbots can answer your customers’ queries round-the-clock, from solving basic policy-related queries & quotes to handling customers’ complaints. The bots can be integrated with various channels – websites, social media, thereby, reducing costs and improving customer experience.
2. Underwriting Rules Engines
The underwriting process which typically includes invasive questions about premiums has traditionally been slow, affecting both the insurer and the insured. Instead of spending valuable time and money on the underwriting process, companies should use AI that could automate the entire process.
AI has the potential to gather information and analyze data by scanning a customer’s social profile. AI tools can predict a customer’s risk more accurately, thereby providing users with the apt coverage.
3. Claims Management
AI can streamline the claims process; from data capture, settlement creation and approvals, to payment tracking and legal matter processing. This can reduce the number of claims that require human analysis, thus lowering costs and making the claims process faster and efficient.
4. Fraud Detection and Prevention
With machine learning and AI, insurance companies can analyze historical data and identify a set of patterns, which can be used to detect fraud at an early stage. AI tools can further help you, deep-dive, into a sea of data and unlock hidden insights.
5. New products and services
With AI, insurance companies are shifting from the current model of indemnifying against damages to a new model focused on risk mitigation and prevention. Using AI, agents gain detailed insights into customers’ demographics, interests, and much more. This information can be used to pitch policies as per customers’ needs, enabling the insurance application development organizations to tap the opportunity.
In a Nutshell
The insurance industry has witnessed not many changes in the past few years. However, a new wave of thinking combined with artificial intelligence technology will soon reform the face of the fast-growing industry. With customers embracing digital at a faster pace, insurance organizations need to step up and transform their processes with technologies like AI.
