Artificial Intelligence, known as AI, is essentially software that is able to think and learn like a human. Today, basic forms of the technology are able to perform specific tasks – like checking an insurance claim for fraud.
Slowly but steady, the impact of the AI in the insurance industry is starting to become more obvious. From intelligent computers that give advice and speed up the process of buying insurance to virtual underwriters and risk advisers. Nonetheless, with these benefits also come new issues.
Artificial Intelligence, also referred to as machine learning, could double the annual economic growth rate in 12 developed economies by 2035, according to Accenture. It is already beginning to find uses in almost every industry, from chat bots that offer round-the-clock financial advice to helping doctors diagnose cancer. AI in the insurance industry seems to fit specially well because it involves lots of data and repetitive processes; the industry actually adopted it pretty early, partnering with technology firms and investing in start-ups on a range of applications.
Michael Bruch, Head of Emerging Trends at AGCS, says AI is likely to transform the insurance industry to the benefit of customers and insurers alike. It can improve the insurance value chain by making it more effective in addressing customer needs, delivering value on time and at lower cost.
A difference can be made by the AI in the insurance industry, specially in three areas: It can help automate insurance processes, give insurers and their clients a better understanding of risks and change the way insurers interact with costumers.
Insurers have mainly focused on developing Artificial Intelligence application for personal lines, but they are increasingly noting the potential the software has in the commercial and corporate markets. It could bring about significant cost savings for commercial insurance, as well as speeding up the insurance transaction process and enhancing service in areas such as analyzing submissions, checking or verifying policy documents, developing new insurance solutions and services or flagging up potentially fraudulent claims.
AI in the insurance industry also has the potential to benefit the claims process, according to Michele Lagioia, an affiliate of the Italian Association for Artificial Intelligence. “AI and automation would make for a much faster and more efficient settlement for lower value claims. Even with more complex commercial claims, AI could support claims decisions, speed up some processes and make for a more customized claims service,” says Lagioia.
Insurers in the life and health market are already using AI to review and analyze policy wordings and validate claims. By automating repetitive tasks, people would be free to focus on value-added work, like client relationships, risk assessment or providing technical support.
In the maritime industry, Artificial Intelligence hasn’t pushed on in any major way, but for container insurance it could validate claims, speed up the transaction process, analyze submissions, review policy wording and identify fraudulent claims.
With information from Allianz.
