8 insurance functions that can benefit from generative AI

5 min read

Insurers are always on the lookout for innovative ways to improve their operations and offer better services to their customers. 

Generative AI, the subject of our latest research report, is a technology that has been generating significant excitement.  Our survey of over 100 UK and US insurers found that 59% have already started using generative AI in their organisation. It is helping their employees make better decisions, perform complex tasks faster, and provide a better customer experience.

Download the report: Generative AI in the Insurance Industry

Generative AI uses data to create original images, audio, and text. It is highly versatile, so can be put to work in many different business areas. These include marketing, administration, claims processing, underwriting, and customer onboarding.

Which business functions can benefit from using generative AI?

According to our survey, over half of the respondents (54%) believe that marketing and claims are the insurance functions that stand to benefit the most from generative AI. Administration came in next at 47%, followed by underwriting at 46% and customer onboarding at 43%. Actuary and legal or regulatory functions were also mentioned as areas that could benefit from generative AI, according to 22% and 21% of respondents, respectively.

Let’s explore how it can be put to use in each of these functions.

1. Claims

Claims handlers can spend hours assessing a claim, reading through customers’ documents, checking policy terms, and processing the payout. Generative AI can speed this up by assessing the claim document, checking the claim against policies, and drafting a response for the customer. Claim handlers have more time to speak with customers and work on more complicated claims.

It can also be used to answer questions for claims handlers and customers in order to understand whether a claim is covered by a policy, so customers don’t waste time making claims that won’t be accepted, and insurers can provide a faster service with a high level of accuracy.

2. Marketing

Insurers can use generative AI to craft personalised marketing content, including targeted ads, email campaigns, and social media posts that are each tailored to individual customers. It can also be used to create personalised products that meet individual customers’ needs and risk appetite.

3. Administration

Generative AI streamlines administrative tasks by automating the generation of routine correspondence, policy documents, and claims-related paperwork. This automation significantly reduces manual effort, allowing insurance staff to focus on more complex or customer-centric tasks.

4. Underwriting

Generative AI can be used to automate the underwriting process by developing predictive models that assess risks and recommend insurance policies or premiums. By analyzing relevant customer information generative AI algorithms can generate underwriting decisions and policy recommendations, speeding up the process and reducing the need for manual intervention.

5. Onboarding

During the onboarding process, generative AI automates form-filling and document verification. It can validate the data, check for consistency and provide a flag should data be missing or inconsistent. By extracting relevant information from submitted documents, AI models generate accurate data entries, minimising errors, and expediting the onboarding process for new policyholders.

6. Training

Generative AI can act as a virtual coach, creating materials and scenarios tailored to different roles within the insurance business, such as service providers, claim handlers, and underwriters. Employees can practise dealing with these scenarios, allowing for hands-on training experiences. It has the ability to simulate client interactions or specific tasks. Additionally, it can serve as a quality assurance tool by reviewing tasks performed by employees and providing feedback. Employees receive personalised coaching and guidance, enhancing their skills and performance.

7. Legal

Generative AI can help insurers with legal tasks such as contract drafting, reviewing, and ensuring compliance. By analysing legal databases, regulations, and historical cases, AI models generate standardised contracts, identify potential risks, and help ensure adherence to laws and regulations.

8. Fraud detection

AI can analyse claim data and spot patterns or inconsistencies that suggest fraud or abuse. For example, it might be able to detect inconsistent long-term injuries in healthcare claims documents more quickly than a human. These can then be analysed and explored in greater detail by a claims handler. Generative AI can then review these findings and clearly set them out for further investigation.

It can also be used to generate synthetic fraudulent claims which humans and automated claims processing platforms can use in training to get better at detecting fraud. At the moment, the number of fraudulent claims that can be used for training is limited.

How can insurers benefit from generative AI?

Our survey respondents highlighted cost savings and business growth as the main benefits. 

By harnessing generative AI, insurers can improve efficiency and productivity.

As it can help claims handlers process claims faster, insurers can offer better customer service, which is critical to keeping policyholders happy. 

It can also be used to find patterns and trends in data, which helps insurers better understand their customer’s needs, and find areas they can boost efficiency.

A previous survey found that 62% of claimants who had a positive customer experience stayed with their current insurance provider. Generative AI can play a big role in meeting these expectations and keeping customers loyal by streamlining claims processes and improving the overall service quality.

Generative AI at Sprout.ai

Here at Sprout.ai, we have used generative AI to create synthetic claims data to train our systems. This has allowed us to build the most intelligent claims automation engine, which is being used by a number of leading insurers.

Every new claim added to the platform brings new knowledge and experience. Just as a human claims handler becomes more skilled over time, our system keeps getting better at what it does, working more quickly and accurately.

The results include reduced errors, increased fairness, and claims handlers having more time to focus on customer service and complex claims, rather than repetitive tasks.

How Sprout.ai transforms claims

Our platform enables insurers to reduce the average time to settle a claim from 30 days to less than 24 hours. In many cases, we enable instant settlement. 

Faster claims processing leads to happier customers and higher tNPS. Not only do customers receive resolutions faster, but they are more easily able to speak to claims handlers, and the outcomes are more accurate.

Claims handlers have time to focus on serving their customers with empathy, speed, and transparency.

Claims teams can process large volumes of data at scale, at speed, and with fewer errors or biases than a human. Insurers and customers can be assured that the fairest possible outcome has been achieved.

Generative AI offers insurers a host of opportunities to revolutionise their operations and enhance customer experiences. By making the most of this technology, insurers can improve efficiency, cut costs, reduce risks, and provide better customer service. Download the report to learn more, or book a call with a member of the team. 

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