How AI Will Change Life Insurance In 2020
Artificial intelligence (AI) is changing how we live in many areas of our life. Life insurance is an industry where it's already making key changes and will continue to do so in 2020 and beyond. It will significantly affect the industry but should do so in a positive way.
It's common practice to use AI for risk analysis which will give customers fairer and more accurate premiums. It will also help to spot any inconsistencies in assessments that have historically been very difficult to get accurate information on.
The cost of human error
Both customers and consumers can pay the price of human error. It leads to inefficiency and irregularities which can cost valuable time and money. Cutting down that human error will lead to an increase in performance and on the back of that, customer satisfaction.
On such area that can be damaging are fraudulent claims. The high functioning AI technology will be able to spot irregularities and therefore reduce these claims which can cost the insurance industry a huge sum of money while also increase customer premiums. The result is more realistic and reasonable premiums and less fraudulent cases.
How claims will be reviewed
With insurance companies heavily relying on the accuracy of claims and the statements made, it made the industry more vulnerable to dishonesty and fraud. There is also the possibility of someone trying to make an emotional argument on their claim when, in fact, there were just trying to play the system.
AI gets rid of that emotional element and can instead make a decision that is solely based on facts and not subjective thinking. Suspicion can be very harmful to trust between both parties in regards to insurance claims. Using AI will provide a better relationship between the customer and the company.
When data sets are built up, AI can use this historical data to spot anomalies that may not have ever crossed the mind of an insurance underwriter. Complex algorithms are commonly seen in all walks of life now and these will be able to check for anything that may look out of place. As more details are fed into the system, it will make even better decisions and get better at being able to spot facts from fiction.
Eliminating human error
There are many people who bemoan AI for taking over jobs that humans can do but in reality, human error is very common and can be damaging for those with genuine claims. Human decision making is much more likely to accept fraudulent cases as the fraud hasn't been spotted.
As much as humans try, they also can't replicate the speed and decision making abilities of AI. Human error can lead to genuine applications being rejected and fraudulent ones being accepted. This is never done with malice and is just indicative that it's impossible for humans to make the right decision every single time.
There is a clear benefit to this as it allows for there to be a human shift towards higher levels of customer service and satisfaction. The customer will have a better all-around experience as their claims are dealt with much more efficiently.
We touched on it there but AI is starting to make companies much more efficient. Documentation can be recorded a lot better and a lot of time will be saved. When reading these documents, AI can scan it rapidly and identify data points in seconds which may take a vast amount of time for human eyes. It's this recording of data that AI can tap into and make rapid decisions.
Data analysis is one of the biggest wastes of time a company can have and it can take talented employees away from other tasks. Instead of being the enemy of human employees, AI can be a great help in getting the information required straight away.
The world of life insurance will be greatly improved by AI. The whole process will be a lot quicker and cases of fraud can be vastly reduced. All business want to be streamlined and AI allows for that with much more efficient use of data
Why AI is better for everyone
Companies, employees and customers will all benefit from AI in life insurance. Companies will waste less time, employees will better be able to communicate and customers will benefit from fairer premiums. The cutting down of fraudulent claims also allows for a much more streamlined process which will save money for both customers and consumers.
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