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The Impact of Artificial Intelligence on the Insurance Industry
The Impact of Artificial Intelligence on the Insurance Industry
While the concept might still seem somewhat futuristic, artificial intelligence (AI) is now truly part of our daily lives. Behind-the-scenes algorithms constantly learn from our behaviors and purchases, making recommendations based on our preferences and selections. Think about all the times you finished a book you purchased through Amazon and were immediately offered a suggestion for your next read – that’s AI in action. The spam filter on your email account? Also AI at work.
Our smartphones, tablets and other internet-connected devices provide mass quantities of data, and along with cloud computing and software algorithms set in place, patterns become recognized within that data. As AI continues to evolve in the coming years, this data will be used in a variety of different ways that will continue to affect everyday life. In fact, by the year 2030, AI can potentially offer
to the global economy.
How Will AI Affect Insurance Companies?
In the insurance industry in particular, modern technology is rapidly changing customer expectations and demands. Your clients are looking for more flexibility in policy risk coverage, easier options to pay premiums and user-friendly ways to submit claims. Insurance companies who implement AI in their operations stand to benefit both in the short term and as time goes by, too.
While artificial intelligence technology is still maturing, insurance carriers should expect it to play a large role in the industry in the years ahead. Some of the ways AI may affect insurance companies include:
More efficient claims settlement processes
Submitting a claim will become more efficient with online interfaces, virtual claims adjusters or chatbots simplifying the process. Conversational AI, a system that allows computers to communicate with individuals via a phone or text message in a way that feels “human,” can help reduce the claims process time from a typical 72 hours to just minutes.
Personalized coverage options
Consumers will be given on-demand insurance policies through an automated buying experience powered by AI. Carriers will be able to quickly customize coverage for specific items and events.
Streamlined underwriting processes
Commercial insurance data company,
, recently announced that they’ve raised
$12 million to generate insights
that will help streamline the commercial underwriting process, allowing insurers to instantly and accurately underwrite any policy. The company’s platform creates detailed customer profiles by mining for public data on the internet, gathering images, text, videos, social media and more to create an accurate view of parameters that could affect a commercial insurance policy.
Usage-based insurance policies
Analysis of data from the Internet of Things (IoT), which is the concept of connecting devices from cellphones and fitness trackers to lamps and washing machines with an “on and off switch” to the internet, will help provide personalized coverage options. For example, in the health insurance industry, wearable fitness devices can help track an individual’s healthy lifestyle choices, allowing them to pay less for their health insurance premiums.
AI and the Customer Experience
Today more than ever, technology is key to offering the best possible experience for your clients. While there’s no doubt that many consumers still prefer human interaction over a chatbot, customer service continues to evolve.
It’s predicted that in the years to come, customers will wish to be as self-sufficient as possible when it comes to filing claims and updating information online. This means new AI technology will become the norm, eliminating much of the need to contact customer service representatives to complete these processes. Policyholders will continue to take advantage of these new technologies in their interactions with insurance carriers.
Additionally, more and more insurtechs are entering the market and are set to disrupt the traditional insurance process. To stay competitive, it’s vital that insurance carriers strive to create better communications with their clients. They should set tools in place that allow them to learn about specific customer preferences to help design targeted campaigns that can better meet their needs.
AmTrust Financial is Ready for the Future of the Insurance Industry
can create and bind policies that are designed to meet their clients’ needs with AmTrust Online. With commercial package coverage information for workers’ compensation right at your fingertips, you can get your clients set up with the products they need in minutes. Then, your clients can use the system to make payments and update their information at their convenience.
To learn more about our
small business insurance
This material is for informational purposes only and is not legal or business advice. Neither AmTrust Financial Services, Inc. nor any of its subsidiaries or affiliates represents or warrants that the information contained herein is appropriate or suitable for any specific business or legal purpose. Readers seeking resolution of specific questions should consult their business and/or legal advisors. Coverages may vary by location. Contact with your local RSM for more information.
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