How Insurance Companies Can Utilize Artificial Intelligence for More Accuracy?

Artificial intelligence (AI) is one of the most influential technologies in our lives. Today, we interact with AI in so many different ways, we hardly notice it. One of the ways we interact with AI daily is through software.

Siri, Alexa, and Google are examples of voice assistants that rely on AI to deliver human-like interaction. Another area in which software depends on AI is recommendation systems. Your favorite e-commerce and streaming platforms use AI to help generate recommendations for you.

You may also interact with AI that is embedded in systems. The most common examples include robotic automation and self-driven cars. There are many use cases of AI today thanks to its different types and branches.

The branches of AI include expert systems, robotics, machine learning (ML), deep learning, and natural language processing. Each branch has its area of focus but you can combine the different branches when creating a solution. For example, digital assistants use natural language processing capabilities and neural networks to answer questions.

Today, companies are leveraging machine learning and MLOps to create solutions for their business. It is as easy as identifying a problem in your operations, creating a concept model, training, and testing. When you are confident, think of model deployment and monitoring.

The different industries such as health care, advertisement, finance, and transport have all benefited from the use of AI solutions. There is much AI can do for insurance companies. In this article, we will look at ways we can use AI to improve the insurance industry. 

1. Analytical AI for Predictive Analysis 

Insurance companies rely on predictions in their day-to-day use. Most of the heavy load falls on the insurance underwriter. The underwriter’s main job is to calculate the probability of the occurrence of an event (risk). They also give a cost estimate for insuring the risk. Underwriters use actuarial data and software to make these calculations.

Think of how you can use artificial intelligence for insurance companies. You can create and deploy an AI model that leverages analytical capabilities. The analytical AI can sift through and analyze large volumes of data, using deep learning, just like an underwriter would. In the end, the model would give a report and an estimate.

2. Analytical AI for Analysis and Fraud Detection

You can also leverage analytical AI to detect and flag insurance fraud. Insurance fraud is one of the most common crimes and is often seen as harmless. However, it has a great impact on insurance companies which are losing billions in false claims around the world.

Insurance fraud is categorized as hard or soft. Hard fraud involves faking injury or damages to get compensation from an insurance company. Soft fraud involves exaggerating the impact of an accident or injury to get more compensation. This may include double billing, faking documents, inflating damage, and falsifying details.

Since technology is improving, it is becoming easier for individuals to commit insurance fraud. The worst part is that most insurance companies rely on old technology to handle and detect fraud.

You can leverage ML and deep learning to detect inconsistencies and create accurate fraud detection AI. Currently, several companies offer AI-based fraud detection software as a service. The leading software includes FRISS Fraud Detection and SEON.

The best part about using AI is how powerful it is. You can rely on the software to filter information about your clients. This includes data from even their social media posts. This will increase the accuracy of your fraud detection and prevention model since you have enough information to work with.

3. Using Visual AI for Damage Assessment

Computer vision is another area of AI that has proven instrumental to insurance companies. You can rely on AI to see and interpret images as humans would, if not better. But how does this help insurance companies?

Insurance companies have to send an agent to check the extent of damage to property or any insured asset. The process entails first assessing the cause of the damage. The agent then investigates the damage and generates a figure for the settlement.

This process can be long and tedious taking anywhere between two weeks and a month. In other cases, the assessment may be inaccurate. In such cases, the policyholder will be under-compensated. However, all this can be improved using AI.

You can combine visual AI and analysis software to assess the damage and predict the cost of repairs. You can use images from drone shots and data from satellites to improve your accuracy. This is instrumental in cases such as roof damage.

The use of AI will increase accuracy and reduce the time it takes to process insurance claims. This will help insurance companies provide faster service and increase customer satisfaction.

4. Interactive AI and Text AI for Customer Service

People often need help to get things done. Sometimes people need clarification before they can make a decision. In such instances, they will rely on people in authority or who know the process. When it comes to insurance, your agents are the ones that handle these inquiries.

You can use interactive AI, such as chatbots, to deal with some of the user issues. The chatbot uses AI to mimic human conversation. People will often not tell the difference. Add a chatbot to your company website to engage with your customers. This will reduce the responsibility of your staff.

You also get the benefit of 24/7 customer service. A chatbot can help reduce the number of errors made while filing claims. You can also use text AI to go through written documentation and improve the speed of processing data.

Conclusion

Artificial intelligence plays an important part in our daily life. AI and machine learning have use cases in every major field, including healthcare, finance, and transportation.

AI offers several benefits to the insurance industry as well. You can use predictive and analytical models for insurance underwriting, damage assessment, and fraud detection. Using AI in these tasks improves accuracy and reduces the time spent. Therefore, insurance companies should embrace AI technology and use it to their advantage.