The Future is Now – How AI is Changing the Face of the Insurance Business
Do you remember the iconic 1968 Stanley Kubrick science fiction movie, 2001: A Space Odyssey, that first introduced Artificial Intelligence (AI) to audiences? HAL, the spaceship’s computer system and main character, was programmed to navigate all ship operating systems and oversee vital signs in the astronauts in suspended animation. When HAL started to behave strangely, resulting in the death of all the crew members but one, the movie took on a malevolent air and the drama of survival between human and machine played out. The famous line “open the pod bay doors, HAL” is a chilling reminder of what a future dependent on AI might look like.
That movie was futuristic— but the future is now. We interact and rely on AI every day. When was the last time you asked Siri or Alexa for information or a command? Or contacted customer support using a chat box on a website? These are commonplace uses of AI today.
AI is transforming the way we interact with businesses and the insurance industry is no exception. Here are five ways that AI is expected to impact the insurance industry:
Behavior-based insurance. Through the use of sensors located in a car, or on the driver’s phone, insurers can gain insights on the customer’s driving habits. For the insurer, receiving this real-time detailed data helps to predict risk factors more accurately.
Enhanced customer service. Chat robots are expected to transform the customer service experience. Commonly referred to as chatbots, these computer programs are able to simulate a conversation using AI. Chatbots can assist thousands of people at the same time, 24/7.
Expedited claims process. Some insurers allow customers to use a smartphone app with built-in AI to take photos of their damaged property to submit a claim. The app will track the status of the claim and communicate updates to customers. In 2017, an AI claims bot from Lemonade, a U.S. tech startup, created a sensation by reportedly settling a claim in three seconds! In that brief time the bot reviewed the claim, reviewed the claimant’s policy, ran 18 anti-fraud algorithms, approved the claim, sent instructions to the bank to wire the money, and let the claimant know it was settled. Now that is impressive customer service!
Fraud detection. Insurance fraud costs the industry more than $40 billion each year. Using AI, data can be analyzed rapidly to detect similar patterns in claims, saving untold hours of manpower. This use of AI is still being developed, but a start up company in France is touting a 75% accuracy rate.
Personalized coverage. The data collected in a chatbot conversation may allow AI to make recommendations of coverage and provide a unique, personalize experience for the consumer.
AI has enormous potential to positively impact the insurance industry by automating many time-consuming tasks and allow the insurance broker to focus on delivering a better experience to their clients.
To read the full article, AI and Insurance: The Future is Here, please click here.