Artificial Intelligence (AI) has become a sensation in the insurance industry. Still, the industry has made significant progress in the implementation of AI, although we are still in the early days.
From a business perspective, AI can be used to manage operations in a faster, cheaper and more accurate way. AI helps automate painstaking processes, which can save you fewer costs and time. AI can also be used to better understand customers — companies can use AI to evaluate customer behavior, understand preferences, and analyze the data they have to optimize pricing and product offerings.
AI has many related technologies, some of which are:
Machine learning: Training computers to identify patterns in data and / or predict outcomes. Other AI technologies are applications of machine learning. Machine learning is often used to develop quantitative trading strategies.
Deep learning: The application of machine learning, where a model can extract analytics and conclusions from data and solve problems without training or explicit instructions or frameworks. These patterns are self-taught.
Neural networks: algorithms designed to simulate the human brain and detect patterns in data. They can detect, classify, and analyze diverse data and find patterns that are too complicated for human programmers to write. A fun example of deep learning and neural networking is Google's QuickDraw, a sketching game that uses a huge database of user sketches to pinpoint exactly what you’re drawing.
Natural language processing: Helps computers understand, interpret and respond to written text or speech. This technique is commonly used by chatbots.
AI in Insurance
Insurance is an old and heavily regulated industry. Perhaps because of this, insurance companies are slow to embrace technological change compared to other industries. Insurance is still slow in manual, paper-based processes and requires human intervention. Even today, consumers face time-consuming paperwork and bureaucracy when they get a claim reimbursement or sign up for a new insurance policy. Consumers may have to pay more for insurance because the policies do not meet their specific needs. In an age where most of our day-to-day operations are online, digitized and convenient, insurance is not always a happy customer experience.
We are beginning to see a worldwide push by insurance companies to enhance their technical capabilities so that they can do business faster, cheaper and more securely. Over the past few years, there have been some prominent examples of insurers investing heavily in Artificial Intelligence Solutions.
1.Areas that can benefit insurance the most are:
2.Sales and Marketing
Future of AI in insurance:
AI has the ability to transform the insurance experience from frustration and bureaucratic to faster, more demanding and more affordable. Tailor-made insurance products attract more customers at better prices. If insurers apply AI tech to the mountain of data at their disposal, they will automatically adjust premiums, customer health, etc to automatically adjust to on-demand pay-as-you-go insurance
Most importantly, the AI solutions described above can make it easier for customers to interact with insurance companies. This could result in people being more likely to purchase insurance.