(Image credit: Hilary Clark.)
In industries that are either heavily commoditized or heavily regulated (or both), it’s imperative that companies doing business find creative ways to differentiate their respective offerings. Insurance companies operate firmly within this market dynamic. As such, they know it’s not only hard to win customers, but also very hard to keep them. In the face of dissatisfaction, switching carriers is a relatively easy process for subscribers. Insurers have learned that delivering a superb customer experience is one way to make it harder for customers to want to leave, and the most forward-thinking companies have made customer satisfaction a number one priority.
One area that’s ripe for innovation related to the customer experience is the claims process. Once seen as a necessary evil, claims—and more specifically, how they’re being handled—are now being viewed as a key means to win the hearts and minds of fickle customers. Fundamentally, and quite logically, the belief is that the smoother the claims process, the happier your customers.
And while insurers are actively investigating ways to remove friction from the claims process, it’s not always as easy as one would hope. Customers want to interact with their insurance company in the same way they do with their favorite ride-share or food delivery app, or e-commerce company. They want simple, on-demand service. It’s no surprise then that carriers are increasingly investing in strategies to implement straight-through processing, no-touch claims, low-touch claims, and everything in between. At the same time, the savviest of carriers realize that even in a world of customer self-service it’s critical to demonstrate human empathy and connection. It’s important to know when automation is appropriate and when a living, breathing person needs to step in. There’s a fine balance between automation and a sympathetic ear and today’s carriers are quite interested in making sure they know what that balance is and how to achieve it. Applying artificial intelligence (AI) to the claims automation process is one of the best ways to achieve this state. Instead of relying on static business rules to drive the process, what we’re essentially talking about is building and deploying an AI claims handler—one that knows not only how, but also when, to say, “I don’t know” and escalate to the human expert waiting in the wings.
With Increased Automation, Increased Potential for Fraud
Yet, as much as carriers are looking at automation to bolster the customer experience, they also know that with increased automation comes the increased potential for fraud—up to a 3X increase based on feedback from the industry. This is another area where AI is extremely well-suited to meet the unique needs of the insurance industry. AI can not only be used to drive true claims automation, but also to ensure that fraud doesn’t mar the process. Giving customers the freedom to manage their own claims process online, from FNOL to payout, and have that process take minutes vs. hours—or even days—is a fantastic way to build customer loyalty. To do so while also removing the specter of fraud is of huge benefit to carriers. And to do so with an AI that knows when to pass a claim onto a human handler, for whatever reason, is even better.
We’re facing a very exciting time in the insurance industry and it will be very interesting to see the many ways AI can be employed by insurers to drive innovation in providing the best customer experience possible.