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Transformation in Insurance Industry

Driven by AI Technology

Jack Ahn

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The Insurance Industry is on the brink of complete Digital Transformation.

By leveraging AI, insurers can engage with consumers in a faster and more convenient way, by offering features such as: virtual customer service representatives at contact centers, robo-advisors for consistent, rule-based advisory services, and virtual assistants for processes and related transactions. Insurers can also optimize products and pricing, predict customer needs and behavior, optimize marketing and sales strategies and optimize underwriting models to continuously predict and identify fraud. 

AI - The New Magic in Insurance

Be it a Virtual Insurance Advisor, Smart Underwriter or Digital Claims Adjuster, all use AI and cognitive technologies to address needs such as: Digital Adoption, Customer Experience Management, Operational Efficiency, Underwriting Profitability, Claims Optimization and much more. Insurance carriers are also combining various digital technologies complementary to AI and machine learning to embrace digital disruption.

A study by shows that 95% insurance executives intend to start or continue investing in AI capabilities in the future: 


Some key trends that are shaping current AI technology in insurance are: 

Explosion of Data from Connected Devices - An increasing number of sensor devices will be connected by 2030 and will be used to collect and analyze data of Insurance customers. This will help insurers understand clients better, offer personalized Insurance products and decide pricing of products.

Increased Use of Robotics - Remotely controlled devices such as self-driving cars, autonomous drones, vehicles and farming equipment and surgical robots will reshape Insurance products of the future by 2025. Insurers will need to re-evaluate the impact of these on risk assessment.

Open Source Data - Open source protocols will emerge to ensure data can be shared and used across industries. For example, data of autonomous cars can be used by auto insurers to decide premiums and build risk profiles of insured customers.

Advances in Cognitive Technologies - Rapid adoption in technologies like Natural Language Processing (NLP), Image Recognition, Voice Recognition, Virtual Agents and Chatbots will lead to disruptive changes in the Insurance industry. Insurers will use these technologies to create innovative products, to streamline processes, lower costs and to captivate customer experience.

Below are some easy to understand Use Case of AI across an actual Insurance business:


Conclusion

Insurers are rethinking their business philosophy and developing a customer-centric value proposition, positioning themselves as protectors more than payers. They are looking to develop innovative products to meet evolving customer needs.

AI, Big Data and analytics, machine learning, RPA, IoT, etc. have significant potential to streamline Insurance operations and enhance customer experience. Insurers have started to capitalize on this potential of technology to address the increasing customer demands and rising expectations. AI alone has the potential to bring about significant cost savings, as well as speed-up the Insurance transaction process. It can easily enhance services like analyzing submissions, checking or verifying policy documents, developing new Insurance solutions and flagging potentially fraudulent claims.

It is never too late too adopt AI technology to your business, as it has already been a major force of market disruption for the past few years.

- Source: LTI Infotech -