4 WAYS AI IS RESHAPING THE INSURANCE INDUSTRY

Karlyn is a writer who specializes in the technology and insurance spaces

 

The technological revolution is changing everything around us, from the way we communicate to the way we purchase goods and services. It’s even changing the face of the insurance industry, by helping us get better, faster, more accurate coverage.

One of the biggest technological innovations in the insurance world today is artificial intelligence. While insurance startups are taking more and more advantage of artificial intelligence each day, this technology was actually created in the 1950s.

Today, AI is becoming an important tool in the insurance sector to help with risk management. Below, we walk through what artificial intelligence is and how it’s helping the insurance industry improve their processes.

 

What is Artificial Intelligence?

Artificial intelligence is technology that helps computers to think rationally and solve problems similar to humans. As computers can hold more information now than ever before, critical thinking becomes easier to teach machines how to do. Today, “big data” processes and stores more information than any one person ever could.

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Machine learning and deep learning are two of the biggest sectors in artificial intelligence today. Machine learning allows computers to identify and analyze continuous trends, which in turn helps them better predict outcomes. A car insurance company could use machine learning to predict both driving patterns and outcomes for specific customers or customer bases.

Deep learning, on the other hand, teaches computers to lead by example. Training computers to perform tasks utilizing artificial neural networks allows computers to complete tasks that humans would normally have to do, which can cut down on time spent on administrative tasks.

 

Artificial Intelligence and the Insurance Industry

Since AI aims to make more trusted and accurate decisions, free from human error, many industries are utilizing the technology in big ways. The insurance sector in particular is harnessing the power of AI to stand out from the competition and revolutionize the way consumers purchase insurance.

You can learn about some of the ways the insurance industry is using AI below:

  1. Improving the Speed of the Claims Process
    If you’ve ever filed an insurance claim, you know how much time it can take from start to finish. Many customers dread having to contact an agent and walk through the dozens of questions needed in order to complete the claim, but AI hopes to change this process by speeding it up and making it more accurate. Instant responses via chat boxes allow customers to get information directly after an accident.
  2. Preventing Fraud and Blocking Hacking
    According to the FBI, approximately $40 billion is stolen from insurance companies through fraud each year. These dollars lost impact both business efficiency and consumer costs. Companies that utilize artificial intelligence can identify and track irregular behaviors to prevent hacks and other fraud before it even occurs.
  3. Adding Personalization to Solutions
    AI also allows insurance companies to personalize their solutions, since no two accidents or incidents are ever the same. Taking a personalized approach allows companies to tailor their services from person-to-person, which can help save them costs and improve customer experience. Through a simple AI application over the phone, for example, an insurance company could get permission to track someone’s driving and thus use that data to adjust their rate. If they are a safer driver, their accident risk is lower, so the insurance company could provide them with a better rate.
  4. Offering 24/7 Accessibility for Customers
    One of the best features artificial intelligence offers is 24/7 access without the need for a 24/7 staff. Companies can save on staffing while also providing around-the-clock value to their consumers. This is especially important given the liability aspect of the insurance industry, when accidents can happen anytime and people need access to information fast. Rather than having to pick up the phone and get an agent on the line, customers can use a chatbox to help them through the process.

Insurance companies can maximize their efficiency by utilizing artificial intelligence. Not only does AI help make insurance safer from hacking and fraud, it also provides more accurate and reliable data for claims processing. All of these features help insurance companies save big. Further, customers feel safer and more protected.

To learn more about how AI is transforming insurance, and the startups that are helping to lead the movement, check out the infographic below!

 

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