AI and IoT Implementation in the Insurance Sector
In the insurance sector, Internet of Things (IoT) and Artificial Intelligence (AI) have already been key technologies as they have been making it more affordable but also accessible and easy for underwriting. Initially, the insurance industry was powered by mathematics, and only an underwriter was able to calculate the risk factors. But AI can be employed to perform repeatable operations that are based on logic and mathematics and offer a higher reliability rate than that done by humans. Let’s look at how AI and IoT will shape the insurance sector.
• Risk assessment and big data: Leading insurance firms are blending their data analytics algorithms with the latest AI innovation to improve the accuracy of risk calculations. The reason behind this is that insurance companies are expected to have vast amounts of data to enhance their appreciation of consumer hazard.
• Plans, Products, and Policies: Insurance companies are all set to develop new ideas, products, and policies. As AI-powered algorithms will gain access to more data, companies can soon create a broad array of customized strategies in real-time. IoT helps insurers to enhance their digital agility and make their products more dynamic; customers will now have access to custom policy presented to them based on their lifestyle. Through their different offerings, companies can now be identified differently from their competitors.
• Digital Disruption: The power that AI processing requires depends upon the nature of data it accesses. This implies that the more data AI has access to, the better rate it can offer. By connecting with the sensors and IoT devices, policies may change in real-time by comprehending more about an enrollee’s behavior and risk profile. As per the reports by Statista, experts predicted that there would be approximately 75 bn connected devices and the data generated by them will help insurance companies to adjust their rates in real-time.
• Customer Experience: Chatbots are becoming the new essentials of this era. As the technology advances, the time is not far when customers will seek assistance from chatbots and ask open-ended questions to them. Insurance firms are planning to offer a personal assistant app that helps one in managing their activities. These apps guide customers through the steps of dealing with an accident or any undesired incident.