How Artificial Intelligence Can Power Insurers’ Digital Future

When discussing artificial intelligence CIOs often describe the opportunity to automate manual tasks, to replicate tasks with machine learning, and to produce recommendations based on learned behavior, but there is much more insurers can do with AI, even in the near term.

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With the talk of digital transformation, Internet-of-Things and artificial intelligence (AI), it’s easy for insurers to think they are behind the innovation curve. Many only recently mastered the claims automation process and moved a step closer towards digitization—and with good reason. Replacing paper-based processes with end-to-end digital workflows can save insurers billions every year. According to the Paperless Project, US companies spend more than $120 billion a year on printed forms, most of which are outdated within three months, and large organizations lose a document every 12 seconds. Modern technologies such as intelligent data capture and machine learning software allow digitally capturing structured and unstructured content to enable insurers to centralize differently formatted documents, reduce costs and accelerate business processes. So, with these efficiencies available today, how can insurers and their clients benefit from AI?

When discussing their AI goals, CIOs often describe the automation of manual tasks, systems learning to replicate tasks, then making recommendations based on learned behavior. This is robotic process automation (RPA) combined with intelligent data capture and machine learning technology and is the fuel for speeding up processes and improving customer service. However, there is more.

Customer Onboarding: Fulfilling the Expectation of Now

Customer engagement processes in insurance companies are undergoing significant transformation. New clients are either young people choosing an insurer for the first time, or people switching from another company—both requiring a fast and comfortable onboarding process. With more consumers being digital natives they expect digital services and their fulfillment in real time. They prefer to use their smartphone rather than physically visiting the insurance office or having an agent visit their home. Using modern technologies, insurers can verify the identity of new clients remotely by allowing them to place their ID in front of their computer or smartphone camera, then use AI-powered face recognition software to compare the ID photo with the customer’s face to confirm their identity. Afterwards, the customer’s data can be entered online or on paper forms that can be photographed by smartphone and immediately emailed. This option is comfortable for consumers while making onboarding faster. Inevitably, this process is less expensive as there is no need for agent or broker visits and only minimal paper work is required.

To Accept or to Decline: Better Insight into Risk

While a snap of the camera digitally auto-populates the new applicant’s information into the insurer’s system, the insurer also needs to evaluate the potential client quickly—before the policy is authorized or the potential client opts for a competitor. The new client’s risk level, exemplified by activities such as extreme and dangerous sports, smoking or reckless driving, can be determined easily using AI. With telematics, mHealth wearables and social media, everybody leaves a digital trail. AI-enabled technologies can access and analyze available information quickly and pre-classify the potential client in terms of risk. A vast amount of information  is available today, but without AI, insurance carriers cannot utilize data efficiently.

From One-Size-Fits-All to Tailored Services

Innovative insurers will soon provide virtual AI-based advisors that offer proactive customer service. Based on analysis of internal and external available data, insurers can advise clients about possible risks or need for new policies. For example, agents can recommend adjusting an insurance premium to increased value of real estate, or recommend additional coverage if clients purchase a new vehicle or take up high-risk sports. With the usage of AI, the offerings can be micro-tuned according to the client’s situation rather than offering standard insurance products. Creating tailored offerings manually requires a significant time investment, but using AI-based advisors allows for a scalable system that can serve thousands of clients at the same time, seven days a week.

Claims Processing: From Weeks to Hours

Claims processing is another major component of customer service—a process that has been historically slow and costly. With modern technologies, insurers can shorten the process and make it very cost-efficient. For example, standard and small damages can be reported by clients via self-services using the insurer’s mobile app and be nearly touchless processing. A virtual advisor can guide clients through repairs and car rentals possibilities close to his home or workplace, and any paperwork that is necessary can be processed automatically with advanced data capture solutions which extract information from documents and forms, thereby shortening the process significantly.

The Power of AI

An AI-based system is able to combine and scale the expertise of insurers’ top analysts and quickly analyze multi-dimensional information. AI leverages clients’ history, lifestyle, family situation, job position and other information from internally available databases and publically available social media sources to help agents and brokers make quicker decisions and provide a better service to their clients. With AI, data today is the new currency and by integrating AI with modern technologies, insurance providers will be able efficiently evaluate structured and unstructured data, better serve clients, and maintain a competitive edge in the digital future.

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Eva Weber // Eva Weber works as Senior Product Marketing Manager for the Software Development Kits at ABBYY. In her role, she is responsible for the product marketing, product management and life cycle management of the SDK products as well as for the development of marketing strategies for different market segments including information services, insurance, machine vision, healthcare and legal sector.

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