How Insurers Can Win the Race to AI Maturity

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Artificial intelligence has been around since the 1950s, but the commercial potential of AI has expanded dramatically in the past several years. We now live in a world where big data and powerful computing capabilities allow AI to flourish. Companies, including insurance carriers, are investing in establishing data lakes. Optimizing cloud-based operations and enabling AI for targeted analytics.

Insurers are seeing tangible results from their ongoing AI efforts. Our AI maturity research shows that Carriers’ share of cost savings generated by AI will double between 2018 and 2021. We predict the stock will triple by 2024. Also, insurers are somewhat satisfied with the returns on their AI investments. Fifty-two percent of insurance companies said returns from their AI initiatives exceeded their expectations, while only 3% said returns did not meet expectations.

However, insurers leave value in the table. In our analysis of 77 insurance companies, we found that none of them were AI achievers, which we define as companies that have a distinct AI strategy and have implemented AI to execute that strategy. In fact, most insurance companies are in the AI experimenter category, with less mature AI strategies and lack the ability to implement AI.

Insurers can move into the Achiever category to achieve greater value by leveraging AI for total enterprise reinvention. This includes applying AI to enterprise-wide decision-making and integrating AI into every part of the business—from business process optimization to delivering redesigned products, services, and experiences to customers.

Carriers looking to gain momentum with their AI investments can identify opportunities in the front office and build their next phase of growth. Our study explored three key front office use cases: customer experience, product and service development, and sales and marketing.

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Customer Experience Insights and Journey Automation

When it comes to customer experience optimization, insurers are starting to make progress compared to other industries—yet they’re still in the early stages of AI implementation.

Many insurers have invested in creating a single view of the customer to understand which products customers own, if they have recently made a claim or if they have received a quote for another product.

While some insurers are beginning to better understand the interactions they have with a given customer, most insurers struggle to connect the customer journey across multiple channels and touch points. Fewer are able to use those insights to understand the breaking points in that experience and properly address them.

While many insurers have invested in customer relationship management (CRM) platforms to share customer insights across the organization, few have layered on AI to use those insights to orchestrate highly personalized customer experiences that include marketing, sales, service and claims. Leading CRM vendors are integrating AI capabilities into their platforms. Choosing such technology is a key opportunity to create omnichannel experiences and create a truly holistic view of each customer.

While automating parts of the customer journey, conversational AI is a largely untapped opportunity for the insurance industry as a whole. Those who create self-contained conversational experiences that meet customer needs—instead of answering frequently asked questions or pointing out where customers can get help—create significant customer service cost savings and higher levels of satisfaction by staying in a challenging labor market. .

New product and service development

Recently, Accenture found that out 88% are executives They think their customers’ needs are changing faster than their businesses can keep up. Factors such as climate change and economic uncertainty are forcing customers to adapt to circumstances beyond their control and move through territory as they try to make decisions that are right for them. Our research revealed the need for organizations to shift from focusing on customers as consumers to developing a nuanced understanding of the customer as a multifaceted human being with complex and often conflicting desires.

This is a change to our customer-centric approach “life-centre” Perfect for carriers when they develop products. AI can help carriers expand their understanding of customer behavior and move beyond cookie-cutter customer profiles with data insights. This will enable them to create offerings that can seamlessly recommend or improve products for individuals to respond to events such as customers’ needs and habits as they move through their lives, buy a new home, or provide protection as climate change becomes natural. Disaster risk.

There are ample opportunities for insurers to develop new products and services that use AI to realize greater value and deliver improved experiences. We are already seeing many carriers implementing AI into their auto insurance products to assess driver behavior and offer pay-as-you-go policies.

As IoT and wearable technology improves, carriers will be able to use AI to gain an even deeper understanding of customer behaviors, meet their needs, and predict what their needs will be in the future. With a deeper understanding of the customer, carriers can create products with greater levels of customization.

My colleague Jim Bramlett Explored some avenues AI can provide another layer of security While collecting data for customers about their risk profile and needs. One of the examples he discusses is an IoT-connected factory floor, where AI stops machines and workers pass by, informs team members about parts that need maintenance and helps them see potential hazards through AR glasses.

Sales and marketing insights, recommendations and process automation

Finally, carriers can use AI to improve their sales and marketing performance. Throughout the marketing and sales funnel, carriers can implement AI to make more relevant recommendations to customers and address their queries. For example, the UK Commercial Insurance Company Taboli It uses AI at every customer touchpoint to deliver business tax insurance products tailored to its target market of micro-SMEs and freelancers. They also use AI to improve pricing and risk assessment based on customer data.

If customers want to speak directly to a person, AI can streamline Human to human experience and increase the likelihood that the client will achieve the outcome they seek. Agents will benefit from more data and insights at their fingertips, which means they’ll be able to capture more up-sell and cross-sell opportunities. Agents can rely on an AI assistant to surface the most relevant information in real-time and make recommendations as they speak with a prospect.

Zombo Partnered with AI CRM company Waymo to develop AI-enabled proactive sales training technology to improve service delivery by their team. Ping On is created Similar solution It provides relevant customer data and real-time coaching assistance that improves agent performance.

How Insurers Can Become AI Achievers

In our latest report, The Art of AI MaturityWe’ve identified five key areas where companies need to invest if they are to realize AI’s full potential and capture the value at stake.

Ensure AI leadership is championed as a strategic priority for the entire organization. When it comes to change, everyone is a stakeholder. Leaders must ensure their teams understand the value AI brings to their daily tasks and business goals.
Invest heavily in talent to get the most out of AI investments. Innovation comes from using diverse people to solve problems in unique and meaningful ways.
Industrialize AI tools and teams to create an “AI Core”. To scale AI, carriers must develop repeatable processes that create a strong foundation for incremental innovation over time.
Use AI responsibly from the start. AI Ethics and Governance Carrier metrics should be at the heart of every AI initiative. Today, only 35% of consumers trust how AI is implemented by companies. To retain customers, carriers must demonstrate transparency and reduce bias.
Plan long term and short term investments. There is no finish line when it comes to AI strategy and innovation. Customer needs will continue to evolve, as will AI capabilities. As planners advance, the need to adapt will increase.

The potential of AI in insurance is far from being fully realized, but carriers that take the initiative to build a strong AI program today will see strong returns on those investments. I’d love to discuss how you can best use AI in your front office, so don’t hesitate Please contact me.

Transforming Claims and Underwriting with AI: AI, when used in conjunction with humans, has emerged as an important differentiator in the insurance industry.

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