July 31, 2019
Embracing artificial intelligence (AI) and the Internet of Things (IoT) can exponentially improve the quality of insurers’ claims management, interactions with policyholders and streamline the customer experience in Claims.
AI gives insurers the opportunity to change their perceptions; becoming more customer-centric and delivering more value to the policyholder throughout the process. Access to data from IoT devices will enable carriers to identify incidents and verify risk management information quicker, vastly reducing the need for costly and time-consuming assessments by claims handlers.
Consumers are existing in an increasingly digitized world and their expectations are being set accordingly – digital-first companies who have a daily presence in consumers’ lives, such as Apple, Amazon and Uber, are setting the expectation of seamless customer-brand interaction and a recent study found that most insurers are falling short in this area. David Pieffer, a practice lead at JD Power, added that “the challenge for insurers is to seamlessly transition the claims reporting function to more cost-effective digital customer care solutions”.
A car accident, through the eyes of the Policyholder
Jane is driving to a meeting and stops at a junction. Another road user fails to pay attention to the road and drives into the back of Jane’s car. From the car’s internal diagnostics, Jane’s AI virtual assistant recognizes that the car has been involved in a collision, and communicates with her through the car dashboard – acknowledging the incident and asking whether she is okay. This is one of the most notable capabilities insurers gain from AI: they can react first, provide their policyholder with timely customer service tailored to the situation and initiate the claims process. The AI assistant already knows Jane, it has all her policy details, so there is no need for Jane to provide that information again when making a claim. Jane’s virtual assistant then utilizes GPS to pinpoint her location, interprets the car’s diagnostics, decides that her vehicle is not drivable, and dispatches an Uber ride to take Jane to her intended destination.
After her AI assistant confirms that Jane consents to her location data being shared, a drone arrives to conduct an appraisal of the incident. This IoT resource drastically reduces the time and cost of assessing the claim, providing better value to the customer. The data collected by the drone is sent to the insurer, the damage is assessed, repairs are authorized, an appropriate repair facility is identified and a tow truck is dispatched to take Jane’s vehicle to it; all in a matter of minutes. Using the drone’s appraisal data, the other vehicle’s insurance information is identified, the relevant data is collated in order to create the claim and the appropriate traffic accident report is filed with the local authority.
The AI assistant then invites Jane to review the claim information on her corresponding mobile app and submit the insurance claim. Jane’s Uber ride arrives soon after, as does the tow truck, and she heads off to her meeting, knowing that all aspects of her claim have been covered for her.
Utilizing IoT devices combined with AI-enabled service can give insurers the ability to deliver a level of customer service unprecedented for the industry. Additionally, the proliferation of data and streamlined claims process also gives the opportunity to employ machine learning to better detect fraud – a problem that costs the U.S. insurance industry over $80 billion annually.
(Coalition Against Insurance Fraud estimate).
Carriers can initiate communication with the policyholder, rather than wait to be contacted about an insurance claim.
Insurers have the opportunity to be there for the customer exactly when they are needed and provide a comprehensive and efficient service, and, most importantly, peace of mind for the customer.
In this digital ecosystem, insurers can take advantage of their access to IoT data to evaluate liability following incidents in a much more effective and data-driven manner than policyholder accounts and stories ever could.
Insurance claims is an unusual business when it comes to customer service – customers are not buying the product to gain immediate access to something tangible, their experience and subsequent level of satisfaction comes if and when the insured event occurs and a settlement needs to be made. Therefore, insurers have the pressure to maintain a high level of customer satisfaction in post-claim scenarios.
With such a transparent market available for insurance buyers, a turbulent claims experience can push customers straight into the arms of another carrier. Insurance firms need to prioritize using technology innovations to streamline the customer experience, and realize that the age-old business mantra is as relevant as it has ever been: ‘Customer is King’.
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