Four Ways Artificial Intelligence Will Impact the Insurance Industry – For the Better
According to a recent Accenture report, over 75% of insurance executives surveyed feel that artificial intelligence (AI) will either significantly alter or completely transform the insurance industry within the next three years, and 39% believe that AI will revolutionize their company’s existing business operations. But with all the positive changes AI has brought, there is still more to come. The following are four ways AI will continue to increase business value for insurers as we move into the new year.
Create a More Consumer-Centric Experience
Customer service and satisfaction are the lifeblood of the insurance industry. They’re what set you apart from the competition, build your reputation, and help retain customers. In fact, providing superior service is critical for nearly every industry – with 33% of consumers saying that a single instance of poor customer service would be cause to move their business elsewhere.
According to The Boston Consulting Group, customer satisfaction in the insurance industry revolves around transparency, quality, and speed. This includes shorter response times; seamless interactions; simple, understandable, and highly personalized service; the best possible quality; and an increase in transparency and fairness. AI is primed to meet consumer expectations and strengthen overall satisfaction by shortening application times, ensuring error-free processing, and allowing insureds to know exactly where they are in the application or claim process at all times.
Improve Claims Processing
For early adopters, AI has already proven its worth in increased efficiencies and reduction of labor costs in claims processing. One area in which AI-enabled technologies have had the greatest impact in the industry is in claims management – automating tasks that have improved processing efficiencies.
Today, many auto insurers are already using AI in a virtual agent infrastructure, allowing policyholders to instantly submit a new claim, upload information, and schedule repairs – essentially completing a First Notice of Loss without having to wait for an adjuster to be assigned. By way of chatbots, claimants can receive important support information throughout the claims process such as claim number, updates, and notification as to when and where the claim payment is sent. AI also is improving claims settlement accuracy with programs that automate damage assessments by reviewing and flagging unnecessary repairs, freeing up an adjuster’s time while preventing and minimizing claims leakage. Although adjusters make the final determination, they won’t have to spend time conducting the initial analysis.
Increase Speed and Accuracy in Underwriting
Earlier this year, the Society of Actuaries published a survey stating that advisers should expect AI to vastly simplify the application process and increase underwriting accuracy. According to the survey, one of the biggest changes is the shift from electronic applications, or e-apps, to web-based applications, with more than half of responding insurance companies expecting to make the change to web-based applications in the near future. This, along with tele-interviewing, the mining of motor vehicle records, and queries into prescription databases, not only cuts approval times and allows for quicker processing, but also allows for a reduction in application errors.
Improve Risk Management Efforts
Because AI is continually collecting consumer data, insurers can use this information to create algorithms to identify risk patterns for building predictive models to better manage high-value losses, reserves, fraudulent claims, and the like. This extraction of key patterns is already in use by many auto carriers (think usage-based insurance devices), but also is benefiting health care insurers by identifying early signs of health issues that can be better addressed proactively with preventive care or more-cost-effective treatments that are currently available. This data is also being augmented to help insurers be more selective when it comes to offering the right insurance products and coverage limits for customers.
Clearly, AI is here for the long haul. Over the next several months, more forward-thinking insurers will begin to leverage the power of AI to streamline processes, improve risk management efforts, and cut down on costs, all while enhancing the customer experience.
Today’s tech-savvy policyholders will continue to expect superior customer service from their insurance company. This includes having flexibility in how they make their premium payments. Learn how One Inc. can provide your customers with an easy, secure way to make their policy payments, while helping you reduce expenses and eliminate unnecessary, time-consuming tasks. For more information, contact us today.