AI is revolutionizing all fields of life, and the insurance industry is no exception. Insurance firms can automate various manual activities with AI and machine learning, driving higher customer loyalty and providing their services quicker. According to Google Trends, since 2012, the demand for AI insurance has tripled.
Insurance firms turn to AI companies to provide specialized solutions, including records management, virtual agents, and intelligent analytical systems. They will use these tools to achieve lower operational costs and better consumer service with faster claim processing, customized pricing, and fraud identification.
How Does AI Enhance Insurance Processes?
So, how can artificial intelligence offer opportunities for the insurance sector? Here are some of the top elements and developments that AI can offer to insurance firms.
Better connections between data segments
Interconnected consumer products such as cars, health trackers, personal appliances, tablets, and wearable devices are growing more popular. The number of customer data grows quickly as these products become more common. This increasing data volume allows insurance providers to assess the risk levels of their consumers more reliably. This can raise the profitability factor for the insurance sector.
Improved customer satisfaction
Juniper Research estimates that by 2023, the total cost savings across vehicle, property, life, and health insurance will from by four times compared to 2019 through applying intelligent solutions. A further gain is the shortened time for claims to be settled and the increased consumer satisfaction levels.
What Are the Benefits of AI in the Insurance Sector?
Here are the biggest benefits that AI can offer in the insurance sector.
1) Faster claim processing
Insurance firms collect significant volumes of data, but data alone is not a great advantage in itself. In its turn, AI can easily process information, simplify and speed up insurance claims, and provide deeper analysis. Therefore, policy holders will get to enjoy faster service, which increases customer loyalty and retention.
2) Fraud prevention
Statistics suggest that fraud is responsible for up to 10% of the claims expenses. AI can detect more fraudulent claims than a human adjuster through data modeling. This will greatly help insurance firms in eliminating fraudulent cases and saving money.
3) Loss prevention
By integrating data from multiple sources, AI can help streamline the process by avoiding excessive medical treatments. Insurance firms can also use data for risk evaluation and preventive promotion. AI-based solutions are also projected to enhance the process of underwriting in the insurance sector in the next five years.
4) Better customer experience
Insurers can use virtual assistants to enhance consumer service in general. AI systems use natural language processing (NLP) for interacting with human callers. These systems can easily settle claims by evaluating complaints and addressing customer requests.
Which AI Technologies Are There for Insurers?
Here are some AI technologies that can take the insurance sector to the next level. These can be used individually or combined into a powerful all-in-one solution.
Insurance firms can develop machine learning models for a more precise assessment of customer risk profiles and suggest optimal insurance premiums based on customer information. This way, deep learning can take the burden away from human workers while reducing the margin of error.
Virtual assistants and chatbots can play a key role in customer engagement. As processing customer requests can be an arduous activity, simple questions can be delegated to chatbots, allowing staff to concentrate on more value-adding operations. Chatbots may also be used for smart call routing to forward consumers to certain operators depending on their needs.
Data processing and management
To collect relevant evidence during claim processing, insurance agencies must handle a high number of records. AI can automate these procedures and assist businesses in handling documents faster and save time and expenses. For instance, with its AI-powered document processing technologies, Hypatos reports that it can save up to 90% of document-related expenditures.
Artificial intelligence is now a powerful component of business practices, processing lavish amounts of data and resolving customers’ issues. Analysts, personal assistants and customer support managers can all benefit from the introduction of AI, especially when it comes to its forecasting potential. AI is here to stay, and it is time for the insurance sector to embrace the many opportunities this technology presents.