Every day digital advancements change the way we look at and interact with the world. New ways of sharing information and collating data have made things in some ways simpler, even in complex areas such as auto insurance.
Advancements in AI (Artificial Intelligence) are the most likely to bring a great chance to auto insurance. Currently, we are looking at an insurance market that has changed very little over the years. The real question is, how much longer can stagnation last?
AI still has a long way to go before it is on par with the beings portrayed in science fiction novels. Still, there are plenty of ways for modern AI to help the insurance world. AI processes can help with pricing, handling claims, and fraud detection, just to name a few options.
The advantage of using AI to set prices comes with the ability to create individualized and personalized policies. An insurance company that employs this tactic will provide custom quotes curtailed to the clients’ needs, creating a competitive advantage.
Artificial intelligence could easily customize these policies based on user location, marital status, family status, the likelihood of premium charges, driving history, and more. Most notably, it could also make sure of IoT (Internet of Things) to draw in more personalized data.
Given the potential power of AI, the level of personalization is limitless. The policy could go beyond personal records and look into the car the coverage is intended for. Here crash and injury data could quickly come into play, as well as automotive history.
As for handling claims? It wouldn’t take much effort to automate the handling of certain claims through the use of artificial intelligence. This would save time and money in the long run and give clients a faster customer service experience.
In turn, this would shorten the time required for settling claims. This will result in happier customers, but it will help limit fraud cases in the process. This is a vital element, as insurance fraud is currently costing companies around $40 billion per year. AI can easily detect fraudulent cases, diminish risks, and streamline the process for legitimate cases.