AI delivers automation at scale for insurers to drive efficiency and customer experience

By Patrick Ashton, Head of UK Operations at Alula Technologies

26 Mar 2024, 09:28

For insurance, digital transformation has become a business imperative. As part of this, adopting advanced technologies such as Artificial Intelligence (AI) and Machine Learning (ML) to automate manually intensive functions can reshape the insurance landscape, especially when it comes to its core functions, such as underwriting, claims processing, and customer service. 

Using AI to drive automation can significantly streamline business operations by enabling a faster decision-making process and reducing manual workloads. Furthermore, automation can improve the efficiency and accuracy of underwriting by assessing risk better using external datasets. With an automated environment in place, insurers can personalise the customer experience through chatbots, virtual assistants, and personalised pricing. Intelligent systems not only analyse and extract data from claim documents, but they also keep the customer informed throughout the process, leading to quicker claim decisions and higher customer satisfaction. 

Regulatory considerations 

Nevertheless, it remains crucial to ensure these technologies operate within stringent data privacy, compliance, and ethical boundaries. Using AI to deliver automation presents significant challenges, including quality of and access to data, the need for specialised skills, and operational change management. Many AI algorithms rely on large volumes of high-quality data to train models or make accurate risk predictions, and recruiting and retaining the right people who can work with data science or AI toolsets is a significant task. 

However, the opportunities far outweigh the challenges. AI and automation offer insurers a competitive edge, allowing for better risk management, quicker customer onboarding, custom-tailored insurance products reflecting actual risk, and, overall, an improved customer experience. Insurers must, therefore, embrace the need for change and implement plans that address the potential impact on existing business processes. 

Part of this entails continuing to drive the innovation agenda at boardroom level. This includes not only supporting experimental projects but also fostering an environment that encourages new ideas and transparent discussions about new initiatives. It is equally important to invest in people with new technology skillsets, create strategic partnerships with technology and data providers, and focus on customer-centric solutions. 

Workforce transformation 

As insurers integrate AI and automation into their systems, they must acknowledge the impact on the workforce. While automation will eliminate certain tasks, new roles and responsibilities will emerge. Transparent communication, continuous reskilling and upskilling activities, re-defining job roles to include higher-value activities and improved employee well-being support are all part of a comprehensive strategy for managing this transition. 

Amid increasing concerns about data privacy and security, leveraging AI and automation responsibly becomes a priority. Insurers must embrace stringent data governance and design solutions with data security and privacy at their core. This includes ensuring informed consent from customers, maintaining transparency in AI systems and their decision-making processes, and employing robust data security measures. AI techniques that preserve privacy should be used, allowing for insights to be derived without exposing sensitive information. 

Industry-wide approach 

It is also important to collaborate with industry bodies and regulators to shape best practices around the use of AI and the resultant automation. Doing so not only safeguards customers but also promotes a sustainable approach to digital transformation. 

To this end, insurers are focusing efforts on integrating AI into their systems and processes to deliver more intelligent, automated solutions that can rapidly scale to their business requirements. Improvements in efficiencies while improving the customer experience have become crucial strategic enablers, with AI providing insurers with the tools to do so in enhanced ways. 

As insurers continue on this transformative journey, Alula stands committed to leveraging AI to deliver automation to deliver value while adhering to our principles of responsibility, privacy, and customer-centricity. These technologies, when used ethically and responsibly, have the potential to fundamentally enhance the insurance industry, leading us towards a future of better risk management, efficient processes, and personalised experiences. 

 

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