From retail to manufacturing to insurance, technology is shaping every sector. In this journey of transformation Artificial Intelligence (AI) is a buzzword that has the power to change the future of business and the way people work.
In today’s digitally competitive world, insurance industry has marked noteworthy progress in AI implementation. With the help of AI, the environment of maximum productivity is created in the Insurance Industry.
Though we are still in the early days of artificial intelligence there is a lot which we can discuss.
In this article we will try to understand:
-How insurers are using AI and cognitive tools to embrace digital disruption
-Explosion of data from connected devices
-Role of AI in captivating customer experience
-Why insurance industry needs AI solutions
-How machine learning will improve the traditional statically models of sales
So, let’s begin…
What is Artificial Intelligence?
AI is a branch of computer science which is specific for building smart machine solutions for complex tasks that usually involve human intelligence. From playing chess to self-driving cars, AI depends on deep learning and natural language processing. To compete with world AI is used almost in every sector as it makes the process more easy and efficient.
How Artificial Intelligence is changing the Insurance World?
This 21st century is a digital era where every being is becoming intelligent, independent, keen learner and curious- credit goes to technology. Today’s sale world is different from the traditional ones; this digital disruption has created a condition where your costumers look for access to insurance services digitally. They want an insurance environment where they can compare policies online, and will receive more modified services and plans. So, to match the speed at which data is generated on regular basis, insurance sector requires a powerful and innovative technological support which AI can provide.
You cannot keep an eye on thousands of claims, customer queries and diverse market- AI and cognitive technologies are the need of an hour.
According to the recent study from Tata Consultancy Services, insurance sector has invested $124 million in AI and other industries have invested just $70 million. There are four areas where an insurer can implement AI to improve customer engagement, fight against fraud and streamline business process.
Let us discuss each area in a detailed manner-
Why insurance industry needs AI solutions?
In today’s world, the insurance sector is vulnerable to three challenges-
-Connecting with potential customers at the right time
-Providing the right solution to the customers
-Quick claim support to trustworthy customers and rejection of forged claims
Insurance companies are determined to have technologically well-sounded solutions in order to keep their employees synchronized. There are various types of employees in this sector and they can create confusion in the business ecosystem. To make the system more uniform and efficient, AI-powered solutions can be considered. It offers various technology-enabled solutions like: Smooth flow of business communication
-Technical claim support
-Interactive Insurance chatbots
-Prognostic analysis
AI in fraud spotting and credit analysis:
On an average one in five persons claims that insurance industry receives is either false or inflated resulting in the loss of $101 million per year to the US insurance sector. So, what is the solution? As an insurer, you have to tackle this fraud smartly and the way is AI driven software. The software is processing thousand of claims every month. They work on certain rules and indicators which can analyze fraud claims in milliseconds. AI works on the frequency of claims, past behavior of a customer and his credit score. With the help of leveraging machine learning, Chinese Insurer Ping An saved US $302 million from fraudulent claims in one year… Sounds shocking? Well, it is. This is how it is helping to identify more authentic insurance claim.
Changing Traditional sales model in the insurance sector:
AI is changing the traditional sales process by introducing more systematic customer profiling and segmentation. Once you are equipped with perfect internal and external customer data you can build a more accurate picture of your customer, which means it will be easy for you to pitch your services according to their insurance needs. This data will provide you with an overview of your customers’ interests, life stages, conversation rates, etc. Once you will be having good knowledge of your target audience your sale percentage is automatically going to rise. With such an approach, an insurer can even decide relevant recommendation for different types of customers. Insurance companies make customer profiling more advanced with AI-enabled voice and facial recognition, which makes a way to create biological customer profiles for more effective verification.
AI in designing Product and Policy:
Another sector of insurance industries is using AI to notify about their product and policy design.
The insurer can use machine learning to invent customer trends in real-time as it helps to streamline the massive data. These observations are used to design improved product and policy design.
Through AI certain online insurance companies have come up with trending niche policies to insure against broken mobile screens and shipping return products. AI can give you this type of novel insurance ideas that will accordingly boom your sales rate.
Claim assessment and underwriting insurance procedures:
Underwriting is often considered to be an art based on personal judgment but machine learning is making is remarks in this area of insurance by making the process more scientific and authentic.
Many insurers are using advanced technologies like satellites and Internet of Things devices to give a more accurate view of risk. Many companies are using cognitive machine learning to examine medical records for paying medical insurance to clients. During this pandemic where everyone wants to go cashless AI has created cashless claim settlement process which can be preceded in a fraction of seconds.
Importance of AI in the insurance sector in the coming years:
Though most of the insurance companies are using AI in their operation there are still some insurers who still like to observe the potential of AI and machine learning in the insurance sector. To harvest the full range of benefits from AI, insurance companies need to invent a high-level plan that will offer more than just customer experience.
Future is seeing AI in the insurance industry like claims management, damage study through image detection, automated self-service guidance, and others.
When it comes to image recognition, overall cost graph and claim settlement, these operations will be carried out by bots that will get info through pictures and videos of the customer. Researches show in coming years image recognition will be a key procedure for most of the insurance companies. In future with AI is going to provide time-efficient and quality environment to both customers and insurers.
So, wait for it and land into the modern insurance industry with the support of Artificial Intelligence and Machine Learning.
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