A seismic shift is taking place in the insurance industry, and it is largely due to the impact of Artificial Intelligence (AI). The question that arises is whether your organisation will be outcompeted by those who can harness the power of this new technology, or whether it will evolve and thrive in this new AI-driven world. This is not a mere rhetorical question but a stark reality that every insurance company must confront.
The Necessity of AI Adoption in the Insurance Sector
In the intricate landscape of the insurance industry, a significant transformation is underway. Dajon Data Management, a pioneer in data digitisation, is at the forefront of this change with its innovative use of AI. This is not about keeping up with trends; it’s about ensuring survival in an increasingly competitive market. The journey is not a leisurely walk in the park—it’s a race towards relevance in an AI-dominated world.
AI-Powered Underwriting: A Quantum Leap Forward
Envision a future where underwriting is powered by AI algorithms that process data at unprecedented speeds. These models assess risk probabilities with remarkable accuracy, leaving behind those still reliant on traditional methods. The divide between early adopters of AI and those clinging to outdated practices is widening daily. The reward for those who embrace AI is nothing less than a dominant position in the market.
Streamlining the Underwriting Process
AI has the potential to streamline the underwriting process by enhancing the data collation and analysis process. It can propose pricing and terms for different clients in the context of your wider exposure portfolio, in a fraction of the time it takes a human to come to the same conclusion. This allows underwriters to focus on the most productive accounts, rather than treating all submissions equally.
The Neural Underwriter: A Case Study
Consider Athena, the neural underwriter. Unlike her human counterparts, Athena doesn’t need breaks. She consumes vast amounts of data, including credit scores, social media posts, and satellite imagery, and identifies subtle correlations. A high credit score indicates a lower risk of accidents, while frequent beach selfies suggest a higher risk of flood exposure. Athena adjusts premiums in real time, leaving non- digitisers still working out risk coefficients the old-fashioned way.
Digitised Archives: Unlocking the Data Crypt
Venture into the archives of insurance companies, where paper records lie dormant. Dajon Data Management is transforming these relics into a comprehensive digital library. AI algorithms meticulously analyse every entry, extracting patterns, identifying anomalies, predicting claims fraud, and learning lessons from the past that can be applied to the future. Those who fail to digitise are left squinting at faded ink, stuck in the past.
Enhancing the Claims Management Process
AI can enhance the claims management process by both streamlining the process for legitimate claimants and increasing the identification of claims fraud. This not only improves the efficiency of the claims process but also ensures that fraudulent claims are identified and dealt with promptly.
The Resurrection of a Lost Claim: A Case Study
Consider a traditional insurer with a paper archive that hides a forgotten claim from 1995. The claimant, a ship captain, faced a storm in the Bermuda Triangle. The insurer denied the claim due to “acts of Poseidon.” However, AI, free from such superstitions, identifies a pattern: a surge in similar claims during solar flares.
Improving Internal Processes Across Every Function
AI has the potential to improve internal processes across every function, including HR, Legal / Compliance, Finance, Marketing, Operations etc. This can lead to reduced processing times, increased quality and accuracy of outputs, and free up staff from repetitive, data-driven tasks, making them available for more complex, high-value tasks such as customer interaction, strategic planning, product innovation and diversification.
The benefits of AI adoption in the insurance industry are clear. The choice is clear: evolve with AI or face gradual extinction. The future of the insurance industry is here, and it is undeniably AI-driven. It’s time for CEOs and other C-level executives to take note and act accordingly. The survival of their organisations depends on it.