Artificial Intelligence is touching every facet of the world around us, and applications are being found for its use across almost every industry you can think of. The insurance sector is certainly no different, and at Sprout.ai, we are exploring cutting edge ways in which we can harness the power of AI to benefit the industry and also the millions of people that it serves.
But what do we really mean by AI? It can best be defined as intelligence performed by machines. The concept should not be mistaken for rule-driven automation, as seen in the robotic assembly lines that have been core to manufacturing since the 1970s. AI operations are different because they don’t just carry out repetitive actions according to their programming. They can also develop through self-learning without the need for human intervention.
How can AI benefit insurers?
The use of AI is already embedded to a certain extent in both personal and commercial insurance lines. Let’s consider a motor vehicle accident claim as an example. It’s a type of insurance claim that practically everyone has to make at some point in their lives. Numerous steps in the claims process can be streamlined and processed much faster by implementing AI. These include such tasks as identity verification, checking coverage is in place, collating information about the accident from forms and performing checks for evidence of fraud.
AI can remove swathes of manual workload, it reduces the time to resolution and eliminates human error. In short, a claim process that might previously have taken weeks can potentially be wrapped up in a matter of hours. At the same time, costs are reduced for the insurer and everyone can take confidence from enhanced transparency.
It’s not just routine insurance lines that have a use for AI, however. For highly complex claims, such as those in the marine or commercial property areas, Sprout.ai’s Natural Language Processing (NLP) can really come into its own. It has the capacity to assimilate almost inconceivable quantities of policyholder and claims data and its conclusions give skilled and experienced insurance professionals the most reliable and robust information to inform their decision making.
Changing times in the commercial insurance market
Some business customers are already experiencing fully automated insurance processes. An example is in the food industry, where IoT sensors identify when a refrigeration unit goes down, resulting in spoiled food, and triggers a fully automated insurance payout to the policy holder.
These kinds of systems will certainly start to appear in other areas of insurance over the coming years. People sometimes see this and worry that AI is replacing people, and costing jobs. What actually happens is the same as we’ve seen in farming from the late 19th century and manufacturing from the late 20th century. The machines only serve to relieve people of low-value repetitive tasks, allowing them to dedicate more quality time to doing something more valuable and rewarding to optimise the customer experience.
In the years ahead, AI will become ubiquitous across a variety of industries and applications. As adoption becomes the norm, there’s no doubt it will in itself trigger new types of insurance products and new classes of risk. Inevitably, some players in the global insurance market will fully embrace these new areas more quickly and enthusiastically than others. One thing is for sure – at Sprout.ai we are proud to be at the forefront and working with the early adopters to bring about a new age of insurance handling.