the cognistx blog

Insurance Industry Transformation with AI/ML

June 11, 2020
By
Nivedita Dhuliya

Digital disruption has created a situation where customers want most things at their fingertips, including insurance services. From comparing policy quotes to filing a claim, they want everything online. Customers don’t want to wait in a queue to speak to a representative anymore.

According to an Accenture survey, 74% of customers would like to interact with modern technology and appreciate the computer-generated system of insurance advice. However, the Insurance industry has been slow to fully adopt AI. Most companies find it difficult because of their legacy systems that have a hard time keeping up with the pace of digital disruption. Not only does AI implementation need a shift in leadership mindsets, but also an ability to identify appropriate business cases that can be transformed.

“AI technique has
the potential to
create between
$100 Bn to $300 Bn in
value annually across
insurance industry”
LnTInfotech


Strategic adoption of AI/ML can improve several processes within insurance, leading to increased revenue as well as the following key benefits:

• Faster claims processing
• Fraud detection
• Efficient underwriting
• Improved customer satisfaction and Net Promoter Score

Driven by Natural Language Processing, Data quality and Computer Vision, an automated claims process can remove excessive human intervention and file a claim all by itself. Additionally, AI-powered claim support systems can help detect fraudulent claims, avoid human errors and resultant inaccuracies by identifying data patterns in claim reports. AI is setting a completely new era of claims settlement benchmarks, with Lemonade settling a claim in just 3 seconds with its AI bot.

The insurance sector, which is full of data, has benefitted immensely from advances in NLP. Insurers are able to leverage language models to reduce the time it takes to respond to customer queries and find relevant information from the tons of documents. AI can also help underwriters process the high volume of applications swiftly and focus on critical tasks, therefore enabling them to make more informed decisions with better accuracy and efficiency than ever before.

We at Cognistx are working on use cases to streamline claims processing, helping insurance companies improve new client onboarding and identifying issues early with new claims. We feel the insurance industry is ready for AI and as technology continues to pervade, we will have faster and more accurate solutions, revamping the insurance industry.

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