AI 101 for Insurance Professionals

Artificial Intelligence (AI) is moving so fast that even people with a solid grasp of AI can feel like they’re falling behind at any moment. Given how transformative AI is becoming within so many industries, including insurance, we wanted to take a step back to review some of the basics.

What Is AI?

According to Merriam-Webster, AI is the capability of computer systems or algorithms to imitate intelligent human behavior. This technology is integrated into many everyday devices and applications, including navigation, rideshare apps, video games, facial recognition, intelligent assistants, and more. New use cases are emerging every day.

How Is AI Used in the Insurance Industry?

AI in insurance can enhance growth by providing valuable client insights, offering timely advice and information, and delivering a better match between your agency's client base and the high-value insurance and risk management products you provide.

Insurance automation blends the best of two worlds: cutting-edge innovation and the industry expertise of your trusted agents. It allows you to automate time-consuming and repetitive tasks to boost operational efficiency, streamline communications, and personalize interactions.

Think about a tedious, time-intensive (but necessary) task you do regularly. Now think about what you could accomplish if that task was off your plate, or mostly so. AI can do much of that heavy lifting for you, freeing you up for work that directly affects your bottom line and the one-on-one client interactions on which your business thrives.

AI in insurance can also improve the customer experience with things like real-time risk assessment and personalized policy proposals. Integrating chatbots in the contact center can also streamline customer service – providing efficient and effective support and freeing up valuable agency time.

Insurance agencies and carriers are recognizing the transformative potential of AI technology. Although it is still very early in the use of AI in insurance, the possible applications are increasing and improving constantly.

What Are Some Examples of Insurance-Industry Tasks That AI Can Automate?

Types of tasks automation can assist with, but aren't limited to:

• Endorsement requests
• Auto-filling forms with data from insurance documents
• Cancellation and reinstatement monitoring
• Proof of insurance requests
• Claims management and processing
• Policy management
• Customer interactions
• Communications and marketing content development
• Administrative and financial support
• Underwriting, risk assessment and reconciliation
• Fraud detection
• Identifying upsell and cross-sell opportunities

Even at a quick glance, it’s easy to see how AI can help you save vast amounts of time, hassle and money at your agency.

What Is Vertical AI?

Vertical AI is industry-specific AI that tailors its abilities to meet unique challenges and workflows. In healthcare, for example, AI-powered medical imaging platforms analyze X-rays. In HR departments, AI can help recruit talent and automate benefits administration processes.

Insurance agencies can leverage vertical AI to streamline more time-consuming tasks and take advantage of tailored technology that fits their business models. Consider a typical auto collision claim. AI solutions can assess damage using image recognition, predict repair costs, and automate payout decisions to speed up the claims process. Other vertical AI solutions for insurance professionals can connect systems to streamline data entry and accelerate workflows.

Applied is leading the use of vertical AI in insurance with solutions like Applied Epic®, Applied Marketing Automation™, Applied Book Builder™ and Applied Recon™.

We’re particularly excited about Applied Book Builder, which harnesses the transformative power of vertical AI to help you improve your account rounding with minimal time and effort. In the past, it may not have felt worth it to chase down small commercial lines accounts, given the time and effort involved.

But now, Applied Book Builder gathers data from thousands of publicly available sources, including maps and business registration documents, to identify probable coverage gaps within existing commercial policies. This saves you countless hours of manual research and data entry and enables you to focus on higher-value tasks like maximizing the value of every account and growing your business. It’s an excellent example of the power and potential of vertical AI in the insurance industry.

What Considerations Should You Keep in Mind as You Explore AI Tools?

When used as a collaborative partner, AI presents immense opportunities to the industry and the world. However, all stakeholders – including policymakers, tech companies, and insurance agencies – need to be aware of the potential risks associated with AI.

Without the proper precautions, AI can introduce risks through cyber scams, plagiarized data, errors, privacy leaks, fraudulent claims, or misunderstanding of algorithms. Here are some best practices to keep in mind:

Develop Your Plan

Work with your executive leadership team and key stakeholders to identify potential risks and agency alignment as you develop an AI plan.

Do Your Homework

Analyze the requirements and AI capabilities of the products you are considering.

Build an AI-Enabled Workforce

Empower employees with the technology and training they need, along with information about the possible risks and necessary precautions.

Ensure Data Privacy and AI Ethics with Guidelines

Develop guidelines incorporating considerations of bias, fairness, transparency and accountability to ensure that your agency uses AI ethically and legally.

Continuously Evaluate and Adjust Strategies

Generative AI is still new, and you’re bound to learn and adjust strategies as you go. Model monitoring tools can help track the performance of your AI implementation.

Lean Into the Support of Your Technology Partners

Core technology providers should make adopting AI technology natively within your daily workflows easy. Ideally, they will enable efficiencies and support your agency's growth objectives.

View Generative AI as Support, Not a Substitute

Artificial intelligence works best when it’s used to augment and support your agency’s unique strengths and expertise – not to replace the vital work and judgment of humans throughout the digital roundtrip of insurance.

The Future of the AI-Enhanced Insurance Industry Is Bright

To unlock the full potential of AI, insurance agents must stay informed and be proactive in exploring various use cases as the technology develops. We all need to commit to continuous learning, adaptation, and iteration. It’s an exciting time to be in the insurance industry! By leveraging vertical insurance AI, we can drive profitability, growth, and overall advancements in the sector. The key to success lies in not just adopting new technology, but in understanding how to integrate it effectively into your existing workflows to create real value and wins for your agency and your clients.

 Check out our eBook and AI Insights webpage to learn more about AI in insurance.