Mr. Vishal Shah -Head of Analytics & Data Science, Digit Insurance

Artificial intelligence has taken the world by storm. From large language model (LLM) like ChatGPT, Bard, Perplexity, Jasper Chat etc to various new AI tech springing up every week, it has become quite evident that we are in the midst of an inevitable AI revolution. However, insurance industry is already leveraging various AI tech to improve various processes across the value chain. Let’s explore 4 key areas where AI is bringing significant transformation.

1. Streamlined underwriting and risk assessment: Insurers today are using AI-backed algorithms that can analyse large databases, enabling insurers to better predict various risks. This has led to improved decision-making and more accurate pricing models. AI algorithms can also identify fraudulent claims by detecting patterns and irregularities in data, thus reducing insurance fraud to a great extent.
2. Enhanced Customer Service: AI has changed the way businesses converse with their customers today. Insurers are using AI-driven chatbots and virtual assistants to cater to customer needs. These microsystems are trained to provide instant responses, assist with policy selection, quote generation, and even guide customers through the claim process. By using AI to conclude routine tasks, insurers are able to improve overall customer satisfaction and loyalty.
3. Effective Claims Management: Claims management is one the most critical and friction-causing areas in the insurance sector. With AI integration, insurance companies have built algorithms that can analyse claims data and patterns to expedite the evaluation process. Technology also enables auto-allocation of surveyors for inspection based on geography and availability. These systems also smoothen the documentation process for the customers. In motor insurance, AI assists in estimating damages through image recognition technology, eliminating the need for manual inspections.
4. Data-driven Decision making: The insurance industry generates vast amounts of data and analysing this manually will require immense resources and time. AI enables insurers to analyse and extract valuable insights from their data bank. These advanced analytics and machine learning algorithms have helped insurers identify trends, predict risks, and develop innovative products tailored to meet customer needs.

The integration of AI into the insurance sector has led us to a new era of efficiency, accuracy, and customer-centricity. From streamlined underwriting to automated claims management, AI today is transforming the insurance ecosystem at every level.