Three ways artificial intelligence is disrupting the insurance industry

From automating the claims process to improving risk assessment and preventing fraud, here are 3 ways AI is revolutionizing the insurance industry:

1. Claims Process Automated

Claims processing has multiple stages: review, investigation, evaluation and payment or denial, however, due to its highly repetitive nature, the process is often error-prone. Significant efforts are already underway to automate claims, and advanced algorithms and artificial intelligence will increase the speed and accuracy of the process.

As consumers increase their connected devices, insurance companies have access to more data. IoT and various data capture technologies can replace traditional methods of manual notification of loss, meaning claims classification and repair services can be triggered automatically.

Take a vehicle collision as an example. In theory, policyholders could play a video of vehicle damage after an accident, and the artificial intelligence module might convert it into a description of the damage and an estimated amount. Vehicles with self-driving capabilities can guide themselves to a repair facility if the damage is minor, or request restoration or replacement if the damage is severe.

After this, AI-enhanced customer service applications can handle most policyholder interactions directly through voice and text. These applications can interact not only with claims functionality but also with fraud, medical, policy and repair services.

This will significantly reduce claims processing times, while also allowing staff to focus on the most complex and contentious claims, as well as those arising from new and unfamiliar risk areas.

2. Improving risk assessment

Artificial intelligence and machine learning are critical to leveraging the explosion of sensory data to radically improve risk assessment.

Enroll in medical insurance. By deploying real-time data from consumer wearable devices, such as measuring heart health and monitoring fitness levels, insurers can use artificial intelligence and machine learning to gain a deeper understanding of their customers’ health and predict any future risks. This will enable insurance professionals to improve their risk assessment and increase the speed and accuracy of the application process.

The experience of purchasing insurance will become faster and involve less active involvement from both insurers and customers. AI algorithms can develop complex and evolving risk patterns, reducing time to purchase and also allowing insurers to identify very targeted risks and adjust products and prices accordingly.

However, more accurate risk-based pricing may be effective but may also challenge traditional definitions of fairness. Risk-based pricing can reward low-risk customers and impose penalties on customers who represent high risk.

3. Fraud Prevention

According to research by ABI Corporation, a new incident of insurance claim fraud is discovered every five minutes, or 300 cases per day. As fraudsters become smarter and more sophisticated, spotting scams becomes more difficult.

Artificial intelligence goes a long way in helping prevent fraud. As agents handle claims, AI enables them to investigate incidents as they occur by analyzing data such as claims records and documents, background checks, involved parties, and customer insights and behavior. Then, by connecting data sets that might otherwise be viewed in silos, AI enables insurers to quickly identify fraud in near real-time.

The Future of Artificial Intelligence

It’s clear that artificial intelligence will revolutionize the way insurance companies sell products and interact with customers. By providing deeper customer insights, underwriters, claims handling teams and agents will be able to provide personalized service based on customer circumstances and preferences, rather than relying on historical data to predict future trends.

So, as technology advances, mass adoption is just around the corner. Therefore, insurance companies need to move away from traditional approaches and adopt artificial intelligence to enable the next generation of data-driven decision-making. This will enable them to deliver countless new customer-centric solutions, build deeper customer relationships and trust, and gain a powerful competitive advantage.

The above is the detailed content of Three ways artificial intelligence is disrupting the insurance industry. For more information, please follow other related articles on the PHP Chinese website!