AI: Evolution of the insurance industry, not disruption.
As the opportunities for artificial intelligence (AI) continue to infiltrate almost every business, one vertical that is yet to fully exploit the relevant opportunities is the insurance industry. Despite 85% of insurance executives stating AI would be critical to their business’ future, a survey last year by Willis Towers Watson showed that 74% of respondents felt the insurance industry has failed to show leadership in digital innovation.
While the adoption of AI is advancing in insurance, deployment is still not widely circulated. The insurance industry needs to respond to this changing business landscape and recognize the potential of AI to reshape everything from underwriting and claims management, to pricing. In order to successfully position themselves as insurers of the future, carriers need to embrace these emerging technologies.
The True Value of Data
Carriers already have access to seemingly limitless amounts of data, however the volume of data available is part of the problem. Insurance companies are struggling with execution, not only due to the absence of the right tools but also a lack understanding into the true value and potential of data.
With the correct tools, insurance carriers can transform this data to inform and operationalize their customer engagement strategies. AI powered tools like predictive analytics can help insurers now reach their next customer by understanding their approach before it happens. Recognizing the needs of their customers will allow the industry to creating a more personalized journey and better experience for all.
Identifying Customer Intent
AI and machine learning can provide key value in all areas of insurance. Combining customer intent signals and pre-purchase research patterns with past practices and behaviors can show a complete view of a customer’s intent. This greater level of insight into the actual behaviors of their customers not only increases the accuracy of customer profiles but can also assist in risk management.
Insurers are already utilizing devices to determine how much a customer engages in a healthy lifestyle or how proficient a driver really is. Applying predictive analytics to accurately determine the level of risk, could potentially pass on lower premiums for customers.
As the industry undergoes rapid transformation, AI is the overriding force driving this evolution. Whether harnessing predictive analytics to create a more personalized experience or utilizing machine learning to assist in risk management, the market is already shifting towards carriers that can best harness the potential of AI. Key players in the industry need to evolve now or risk falling behind the pack.