5 Reasons Chatbots Will Disrupt the Insurance Industry

Chatbots have proved very useful to insurance organizations as they help them to achieve effective customer engagement, to explain complex products, to improve sales and distribution, and allow fast and contextual access to information.

In this digital era, insurance customers are seeking new ways to digitally interact with their insurers. They want to deal with companies that offer them a better insurance buying experience with multiple touchpoints that go beyond the usual call centers. This is where chatbots come into the picture. A well-designed chatbot can help an insurance company offer a more personalized experience to its customers.

AI bots will power 85% of all customer service interactions by the year 2020’’—Gartner

Chatbots can efficiently handle millions of one-to-one conversations with their customers by acting as a bridge between insurance companies and consumers. Insurance customers find it irksome to go through lengthy phone prompts while being filtered through call centers. Instead, they prefer a mode of communication that includes live chat or texting.

AI bots will power 85% of all customer service interactions by the year 2020’’- Gartner

5 key reasons why insurance companies are shifting to chatbots

  1. Chatbots are more human-like

Chatbots are integrated with capabilities of identifying speech patterns and interpreting non-verbal hints for smoother interactions. These characteristics provide insurance users a feeling as if they are interacting with a real human who is smart enough to handle their insurance-related queries. Moreover, with an increase in the usage of text-based mobile apps that has shifted verbal communication to written communication, customers find chatbots as an ideal customer support available 24 x 7 with user-friendly conversational UI.

  1. Chatbot are replacing apps

It is quite evident that our smartphones are overloaded with mobile apps. It is said that out of 10 apps,  seven are never used and are uninstalled in less than two weeks. This is the prime reason that insurance companies should choose to go for chatbot development as they allow the user to interact with services without the need for downloading or installing an app and having to struggle to learn a new UI.

  1. Chatbots are easy to deploy

It is quite easy and fast to build a chatbot compared to a mobile application. There is a  wide assortment of bot templates, simple tools, as well as ready-made software developed by Facebook, Microsoft and other tech giants you can make use of. However, if you want to customize your chatbot, then integrate it with a messenger platform of your choice and if needed, add some advanced features, and the bot is ready to go live.

A chatbot facilitates communication, enabling insurance firms to organize distribution, claims, and customer support directly into a messaging application that supports millions of regular users and billions of messages every day.

  1. Chatbots can improve customer engagement

Chatbots enhance customer experience with brands because they provide users an easy way to get the information they need.

It will show the user one response at a time with a quick and personalized approach which may include images, content, links, call-to-action buttons or direct payment options based on user input at a specific point. This means that the user is not overwhelmed with information. Hence, chatbots are considered as an excellent tool for keeping users on a certain platform longer and keeping the content flowing from the start till the end by maintaining the conversation.

  1. Chatbots can automate claim processes

Chatbots can help a user to register the first notice of loss, schedule the survey appointment for the evaluator, provide loss prevention recommendations, arrange emergency assistance during accidents, and offer pre as well as post disaster assistance. They can help an insurance company in automating repetitive communication functions without increasing the company’s overhead.

A final word

Chatbots have proved very useful to insurance organizations as they help them to achieve effective customer engagement, to explain complex products, to improve sales and distribution, and allow fast and contextual access to information. The main thing is they can accelerate employee productivity by letting them concentrate on core activities that can differentiate your organization in the marketplace.

Majesco Integrates with Elafris Chatbot for Insurance Communication and Payment Capabilities


Dhaval Sahija // Dhaval Sahija is a Subject Matter Expert for the AI Practice at Softweb Solutions Inc. (Elgin, Ill.). During the last nine years he has served as a strategic consultant for business transformation with emerging technologies such as chatbots, NLP, cognitive science, data science and deep machine learning for the insurance and financial services industries. He can be reached at dhaval.sahija@softwebsolutions.com.  

Comments (4)

  1. Very well written. I agree with the tenets and the conclusions that you have drawn. Am also an avid blogger in this space and tend to look at it more from an evolutionary platform perspective, Read more about it blog.engati.com or create your own bot on our free platform http://www.engati.com

  2. Great article and a very good insight – bots will be the primary interaction channel of the future which holds a lot of promise against the current and traditional formats. The challenge is to make interaction design more intuitive, demystify the tech/ engineering side to bring it into more acceptance of the masses by displaying value, an increase in utilization for business cases. The 24×7 self-service and intelligent nature of the format is already being used for customer service, conversational commerce, health tech and education. We have started on the journey at Engati; do visit us to give us feedback on http://www.engati.com.

  3. Great article and i agree, the roi on these will be clear. I am guessing, customer service costs will drop by 10 or 20 % based on these tools. It may take longer to train new csr’s because much of the entry level work will be done by bots. Though , i assume, bots will be adjust to also be used as training tools for csr’s.

    • Thanks for the comment, Rob. This is one of those areas where the technology is already mature and just needs to be applied. In service applications we’ll see more and more use of robotic process automation, which will in turn be improved by cognitive computing.

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