Artificial Intelligence ignites Insurance Digital Transformation

 -Artificial Intelligence Ignites Insurance Digital Transformation

Artificial Intelligence and Digital Transformation go hand-in-hand these days. The number of instances of companies adopting this technology to either fuel or ignite their transformation is numerous, and spans industries.

Most recently, insurance has been adopting AI-technology to improve the claims process for its consumers.

Artificial Intelligence or AI describes everything from machine learning to the Internet of Things (IoT). AI systems perform tasks that previously required the human touch, for example, visual and speech processing, decision-making and language translation. Examples of the uses of AI within businesses range from automated assistants and chatbots, to self-driving cars.

In the Insurance industry, AI is rapidly evolving the way claims are processed.

UK insurer Ageas announced a partnership with AI specialist Tractable a few weeks ago. By leveraging artificial intelligence (AI) technology to help manage claims to help manage its motor claims, the insurance company is looking to reduce the time it takes for a claim to be processed.

In a statement, Ageas said the technology is now being used in an ongoing pilot to help Ageas engineers verify the performance of its UK-wide repair networks in managing customers’ motor claims. The first-stage of the pilot was completed towards the end of 2016. This initial stage performed analysis of several thousand images of vehicles involved in accidents or requiring repair, enabling the creation of AI Approval.

AI Approval works by viewing images of vehicle damage, making assessments within seconds. The system also connects with Ageas’ back office systems to streamline claim management processes. Over time it will reduce the average claim life-cycle, impacting the consumer experience as well as cutting costs for the insurer.

The technology is also expected to help reduce the instances of insurance fraud, by flagging early any suspicious claims.

“The results of our initial pilot are impressive, and I’m keen to progress to using this technology at scale,” said Ageas’ Transformation Director Rob Smale.

Artificial intelligence has the potential to impact the insurance industry in multiple ways, from Claims Management to Marketing, from Fraud detection to Underwriting.

Claims Management and Fraud Detection

As demonstrated by the above example, AI-Technology is enabling insurers to reduce the average claim life-cycle. This will not only impact the consumer experience but also reduce costs for the insurer.

AI can handle huge quantities of data in a short time, reducing claim processing time and handling costs, by enabling the automation. By automating the handling process, the insurer is able to fast-track certain claims. The technology is also able to assess the severity of damages, predicting repair costs based on historical data and images. In other words, AI is detecting patterns that would otherwise be invisible to the human eye.

The algorithms used in the technology can also reduce processing time by quickly identifying patterns in the data to recognize fraudulent claims. Insurance fraud drives the cost of policies up, as time and resources are wasted.

AI-technology is also self-learning. This means that over time the systems can adapt, capture data, and improve its own analysis capabilities. This is a true example of digital transformation, the aim of which is to transform businesses to be able to adapt to trends faster creating long-term success.


Underwriting and Loss Prevention

Just as for Claims Management and Fraud Detection, AI can be used to automate underwriting by spotting patterns in data that would otherwise go undiscovered.

Insurance typically comes into play after an incident. Just as in medicine AI, by combining several data sources, can be used to prevent or detect early diseases and/or risks. By employing preventative data to underwriting, insurers can more adequately assess risks to lower the probability of damages happening.

Here are just a few examples of the technology out there:

  • Carpe Data – uses predictive algorithms to analyze public data, including social media, to provide data for property, casualty and life insurance underwriting
  • Big Cloud Analytics – collects data from wearables to formulate health scores for smarter risk assessments
  • Cape Analytics – uses geospatial data to assess current house conditions in more detail than ever before

Marketing 

Insurance has a bad reputation. Often painted as money grabbing, heartless enterprises who take your money, but don’t pay out when you need it. This is actually far from the truth and insurers are working to more smartly communicate with consumers, to ensure that there is no confusion when it comes to understanding what policies do and do not cover.

Artificial Intelligence powered ChatBots are helping here. Messaging apps are by far the most used apps these days. Naturally, marketers are looking for ways to utilize this technology to communicate directly with consumers using these apps. By using virtual assistants, which leverage natural language processing and sentiment analysis, insurers can automate the processing of customer concerns in a more personalized way.

Marketers are becoming increasingly responsible for improving the customer experience. Using AI-technology, marketers can assess huge quantities of data in a short time, allowing them to build detailed customer profiles, which in turns means they can deliver more personalized content. The consumer is looking for targeted conversations with brands. AI is enabling this.


ABOUT FSI TRANSFORMATION ASSEMBLY

FSI Transformation AssemblyThe Millennium Alliance is pleased to announce that application for their biannual FSI Transformation Assembly taking place September 14-15, 2017 at Four Seasons Resort in Palm Beach, FL is now open.

Following on from the success of our February edition with Keynote speaker – Lisa Shalett, Retired Partner and COO of Global Compliance, Legal & Internal Audit, Goldman Sachs, the FSI Transformation Assembly will bring together North America’s major financial services and insurance organizations.

While financial services and insurance CIOs will have to deal with many challenges in the coming year as the industry makes the final leap into digital transformation. C-level IT leaders need to understand the convergence of mobile, social, and cloud to stay ahead of the competition. One technological challenge remains prominent in the mind of CIOs everywhere – dealing with the complexity of data. This is something challenging all digital transformative industries.

With digital enhancement comes a massive explosion in data, which is creating unprecedented manageability issues for firms around the world that can be linked to the following factors: expanding customer touch points, emerging types of structured and unstructured data, new customer engagement and social media platforms, rising data security, and controlling the overall data volume.

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