Artificial Intelligence Is Dramatically Changing the Insurance Industry
Ventiv Technology is a Business Reporter client.
Insurance risk managers are embracing new technology to predict and manage incident outcomes.
Artificial intelligence (AI) has been at the forefront of technology leaders’ conversations for several years. The focus is to create human-like processing abilities so that companies can complete task-based work that would traditionally require manual efforts.
The inherent advantage of a computer that can self-correct, understand and learn is the promise of not only doing what humans can do, but also doing what they cannot. AI can analyze vast amounts of data, make assumptions and provide predictions at a speed, scale and depth of detail that is impossible for individuals. Furthermore, it can do so without the administrative limitations of a human workforce—reducing downtime, turnover, knowledge gaps and costs.
According to a 2021 report, companies are investing in AI not only to disrupt their industry’s current methodology, but also to supplement and enhance their own business processes. The report found that “respondents report significantly greater cost savings from AI than they did previously in every function, with the biggest year-over-year changes in the shares reporting cost takeout from using AI in product and service development, marketing and sales, and strategy and corporate finance.”
The flexibility of AI applications
Who can benefit from the opportunities presented by AI? The limits have yet to be fully realized—but insurance providers and administrators have certainly started to test the waters.
At its core, AI applies advanced analysis and logic-based techniques to interpret events, supplement and automate processes and help leaders take effective actions. Because AI can learn, it can be taught to serve more than one purpose. For most insurance risk programs, AI can be used to serve multiple business objectives. Determining which kind of AI-assisted processes your business needs is the first step in applying AI effectively.
At Ventiv, we have built tools that leverage state-of-the-art AI to predict a variety of insurance-related scenarios. For example, Ventiv Geospatial can conduct simulations and predict the direction and impact of severe weather patterns. These simulations make risk managers more effective because they can see that a storm is coming and predict how it would impact a client’s properties. They can now get data-backed answers to such questions as, “If a major storm’s trajectory changed, how would that change the business impact?”
Workers’ compensation is another branch of insurance that can benefit from AI-driven analytics. By automating several processes around how bodily injuries are scored, insurers and administrators can more accurately anticipate the time it will take to get an individual back to work after an injury. Those data points can now be at your fingertips.
Better business outcomes with AI
While marveling at the impressive wealth of knowledge offered by AI, business leaders are becoming wise to the bottom-line implications of an AI-backed organization. Using the injury example above, imagine the advantages, when an event occurs, if you could know what to expect and how to identify if a case will go to litigation. Imagine having the automated processes in place to streamline standard cases, so that your top talent could prioritize and mitigate the most threatening and expensive claims.
In 2022, companies of all sizes and types realized that not leveraging AI means they are falling behind. Smaller insurance players are making strategic investments in AI because they need the leverage to bring on clients faster. Larger carriers that initially struggled to make investments in AI because of legacy IT capabilities and arcane tech architecture are now leaning into the change.
Embracing AI as part of your risk management program is the only way to ensure that you won’t be left behind. Smart, agile organizations are embracing the future because it’s already here.
To learn more about Ventiv’s industry-leading solutions for claims and risk management, visit ventivtech.com.
— Mark Tainton, Head of Strategic Analytics, Ventiv Technology
Mark Tainton is developing cutting-edge AI automation, straight-through processing and predictive scoring to enhance decision-making for Ventiv’s growing customer base. He oversees the development of Ventiv’s advanced analytics product suite, including Ventiv Predict, Ventiv Geospatial and Ventiv Data Sciences. Known for fostering business, data and technology innovation, Tainton has a rich history of leading, building and mentoring data analytics and data science teams.
This article originally appeared in Business Reporter.
Image credit: iStock id1356593548
