How AI is Changing the Insurance Industry

For many years now, Artificial Intelligence or AI has been more than just a science fiction concept. From smart home assistants such as Google Home or Amazon Alexa all the way down to the intelligent algorithms that recommend you videos on YouTube or select the next song on your Spotify playlist, AI is all around us, changing our lives for the better and making life much easier.

One of the areas that can – and do – greatly benefit from Artificial Intelligence is in the world of insurance. Here is how AI is changing the insurance industry.

Chatbots and insurance – a perfect match

A good relationship between an insurance company and its clients relies on good customer service. Now, you can use a chatbot for insurance customer service.

Different types of chatbots – AI-powered software that can mimic human conversational skills – can help you guide your new and existing customers through various stages of your insurance business.

There are onboarding bots that help with new customers, claims management bots that help with insurance claims, quote and renewal bots, and more. They all have one crucial thing in common; chatbots are able to learn from their past interactions and constantly improve themselves. So, the longer you use them, the better they get at doing their job.

Besides, chatbots never get tired or need a break, so you will be able to offer high-quality customer support 24/7.

AI and risk management

An insurance company can maximize its profits by acting proactively by taking preventive action before a risk occurs. With the help of AI and machine learning, it is much easier to identify and predict many different risk factors, such as potential frauds and credit risks.

At the same time, since AI is just a piece of software – albeit a highly smart one – it is much easier to get your AI up to date with any new rules and regulations than it would be to train human employees.

It bears repeating that AI employs advanced fraud detection, prevention, and prediction techniques for fraud prevention. Thanks to them, you will significantly decrease false-positive insurance claims and thus be able to redirect your human resources to more critical tasks.

Make “big data” work for you

Even though we are all individuals, some people share the same patterns of behavior, wants, and needs. Unfortunately, these patterns can be hard to spot without looking at the “big data” – a collection of information about a large group of people – and finding similar threads throughout.

Once again, this is something that AI can handle much better than any human ever could.

Noticing these patterns in the insurance business is essential because trends are constantly changing. Without AI, you risk your company is stuck in the past and offering insurance deals that are no longer relevant to the current customer.

With AI by your side, you will offer each customer an individual insurance plan tailored to match their needs.

Returning customers matter

According to Forbes and numerous other reputable sources, acquiring a new customer can cost five times more than keeping an existing one. This can be especially important in insurance, where customer loyalty should be highly cherished.

You can use the big data mentioned above for more than just offering personalized insurance deals. With this insight, you will better understand which offerings will suit which customers and make your sales go much more smoothly.

Moreover, you can reach out to your existing customers via email and use AI to send them a personalized note every once in a while. According to a recent study, reaching out to your current customers at least twice per year increases customer loyalty.

In these ever-changing and uncertain times, a loyal customer is someone you should cherish and keep.

Streamlined workflow and AI

Automation is one more significant advantage of AI in insurance. This means that AI solutions can manage the entire customer journey with minimal human interference.

Such an approach will result in a much more streamlined process since AI can be there to give customized quotes, help with onboarding and help customers with claims processing.

Ai can serve multiple customers at once while processing multiple and cross-referencing numerous data points. In addition, it can deal with documents and payments, make policy adjustments, and much more.

At the same time, with fewer people involved in the process, there is much less room for error – human error, that is.

Processing claims involves going through several documents, comparing data, doing calculations, and much more. A human can make a potentially costly and fatal mistake every step of the way, while AI can not do that.

AI can handle different types of documents and data and integrate and handle them all seamlessly and simultaneously – a feat that we humans are yet to achieve.