(Image source: Apple.)
Apple recently announced the launch of the iPhone 12 Pro and the iPad Pro, both of which have improved augmented reality (AR) capabilities through the company’s LiDAR Scanner. Light detection and ranging (LiDAR) is light in the form of a pulsed laser that can measure distances. Combining LiDAR data with camera data, motion sensors, and computer vision algorithms enables faster and more accurate processing of real-time data and more sophisticated AR applications. Improving the AR potential of consumer hardware will lower the barrier to entry for companies to pilot AR technologies.
What Is AR?
AR provides data to the user by overlaying digital displays of information onto video of the physical world. Like machine vision, AR involves AI-based image analysis, but unlike machine vision, the information from the image analysis is provided to the user in real time. The real-time component of AR’s data processing capabilities offers the promise of an enhanced human-machine partnership.
Insurers are increasingly interested in the potential value of AR, which represents another channel through which to reach digitally immersed consumers. AR is a tool with the potential for cost savings, customer retention, growth, operational efficiency, and even enhancing existing uses of AI. Many insurers and startups already use machine vision in areas like claims damage assessment and risk mitigation for personal property. The addition of AR could allow the assessment process to happen in real time while incorporating information like building materials, condition, or damage potential.
AR Use Cases
Insurance-specific AR use cases fall into four main categories, as noted in Novarica’s recent report, Augmented Reality in Insurance: Overview and Prominent Providers:
- Customer education and marketing
- Risk mitigation and loss control
- Claims adjusting and assessment
- Guided underwriting
Current initiatives tend to center on customer education and marketing. AR can be used to enhance marketing material by overlaying an interactive marketing experience on an insurer’s physical marketing materials to explain offerings and promote products. MetLife used AR to disperse information about product offerings, for example. When a user scans the cover of MetLife’s dental brochure using a smartphone, the pamphlet comes to life and offers information about services and plans. Insurers have also developed applications which illustrate the growing flood threat to coastal areas from rising sea levels and help policyholders understand retirement goals and complexities.
Other initiatives focused on risk mitigation and loss control show accident potential for real-time and possible future hazards. Allianz launched “Haunted House” in Hungary, an AR-based app that demonstrates accident potential within homes, and AXA used AR technology in Belgium to help demonstrate the potential consequences of car accidents. Smart glasses can be utilized to augment workers’ vision and identify hazards in their immediate surroundings; construction companies are using AR to improve site safety, provide virtual training, and reduce training-associated travel costs.
AR is also being used by insurers to provide service support and training. Zurich utilizes smart glasses to help on-site field adjusters, providing capabilities such as real-time documenting of work progress, remote conferencing with experts, and site plans. A Fortune 50 insurer works with Skylight to provide coaching to property field adjusters through smart glasses.
Future of AR in Insurance
Future adoption of AR might include real-time damage assessment, loss mitigation, and underwriting. A property adjuster might use AR technology to capture the interior or exterior of a house where a property loss occurred. The application could present previously captured information to allow comparison of the differences. The application, through AI-based object recognition processes in combination with valuation appraisal AI, could assist the property adjuster in identifying areas of loss and estimate the value of the total loss.
AR is very much an emerging technology in insurance and other industries. Two limiting factors for widespread consumer AR adoption are access to bandwidth/5G and the cost of AR hardware. AR applications often experience connectivity issues in geographies with limited 5G access, and AR hardware can be cost prohibitive. As consumer technology companies continue to build out AR capabilities and telecom providers build out 5G infrastructure, the barriers to entry and challenges associated with launching AR initiatives will be lessened.