The automobile industry has welcomed new technologies with new functionalities and increased efficiency, however, with every novel feature that gets introduced into the vehicles we move in, there will be an equal and opposite effect on the auto-ancillaries and the insurance companies as well.
For instance, driverless cars are no longer a figment of imagination or a prototype going through the proof of concept stage for investors.
It has become a reality and many people own initial levels of autonomous cars and drive them as well.
This means that even in the future when there is an accident, it is possible that it would not be attributable to the driver because of a self-driving vehicle; the insurance companies still think of the change in the market for liability insurance coverage.
How are Insurance Organizations Utilizing AI?
Insurance providers are using AI and big data in advanced analytics that can turn into great assistance in the predictive assessment of risk.
The data helps in accurate underwriting of the individual policies that aid in improved pricing.
Claims processing has improved with automation as the time taken to settle the process is reduced with the seamless functioning of the cycle.
Fraud detections are now amplified where arsons and false claims are identified based on the data provided through blockchain technology.
The new era of AI-assisted features extends beyond just driving flashy cars designed with features that were previously unimaginable in a humble vehicle meant for daily commutes.
It is helping insurance providers develop new policies that can match the car features when keeping the guidelines of underwriting intact.
With improved services and automation now it is possible to get auto insurance same day without delays that were common in the past.
Insurance companies can use tools that will help them determine the right pricing of a policy based on the personal driving abilities and the car’s maintenance.
If a driver consistently crosses the speed limit and is known to be irregular with the vehicle’s service, then the data will determine a higher price for the policy issued to him.
Defensive driving, upkeep of a car so that it passes its safety and smog test, and parking the car in a safe spot regularly are self-assurance traits that help reduce the insurance cost.
It can be treated as brownie points one gets for being a responsible driver and a valued customer.
But this data is now collected from various other reliable sources and the provider need not rely on the expectation of true declarations from a consumer.
Here are some advancements in the auto insurance segment that are changing the game for better and improved service:
AI-Powered Devices
The transformation in auto insurance is evident with the implementation of AI-powered smart devices that read into critical data that will determine the underwriting score for any policy.
Telematic gadgets capture information related to driving habits like speed, brake application, collision avoidance, following driving rules, and driver’s judgment at critical times.
These data points help insurance providers in customer acquisitions and risk management.
Based on the data, safe drivers who keep their cars fit are offered discounts or extra riders without additional cost.
The onboarding of consumers increases without increasing the risk as drivers who defy speed limits regularly and don’t take good care of their cars are offered insurance policies at higher premiums.
Therefore, due to pressure to increase sales, the providers need not forgo compliance requirements.
Based on user-based insurance or UBI, consumers are incentivized with benefits without additional cost or offered discounts like loyalty bonuses.
According to the Research Fact,
The global AI in insurance market was valued at $4.59 billion in 2022 and is projected to reach $79.86 billion by 2032.
Easy Access & Onboarding
Consumers can now fill out the forms through multiple omni channels like mobile apps, websites, and kiosks at any time of the day.
One can avail quotes, compare them, and choose a policy when waiting in an airport terminal for their next flight.
A person need not necessarily walk into an agent’s office to fill up the application form for auto insurance.
The OCR or optical character recognition captures all the data from the requisite third-party websites and scanned documents submitted by the consumer.
For instance, when a consumer uploads an image of the driver’s license, the address is recognized and auto-populated in the application form.
The time taken to process the insurance paperwork is reduced with automation that takes care of reviewing the information and issuing documents seamlessly without errors.
Consumers get instant replies to their inquiries as most FAQ’s are answered by chatbots with preemptive questions and concerns.
The frequently asked questions are based on large datasets that are compiled based on frequent customer interactions and consumer experience platforms.
Using semantics, the bots are empathetic to consumers when answering various questions related to policy terms, claims processing, or providing roadside breakdown assistance.
Paperless Contracting
Now the final documents can be issued digitally to the consumers using eSign and electronic contracting platforms.
That means, there is no need for physical interaction with the end consumer as all the platforms are automated and offer encrypted security of personal information.
With smart contracting, closing the insurance policy for multiple individuals in a single take is carried out effortlessly.
At every stage of the document finalization, the consumer can refer to the AI assistant for any inquiries that are answered promptly.
Conclusion:
Affordability and compliance are the major two features that we look for when purchasing insurance.
In case of an eventuality, one should be able to pay the damages caused in case they are liable to pay the same.
Some states are tort-based and require liability insurance as a mandatory minimum requirement in case of an accident; personal injury protection is required in a few states.
AI-powered assistants will help in picking the right policy that will help you with features that will differentiate between what you want and what you need.
Based on your budget and requirements, you can finalize the policy by adding or removing deductibles and limits.
In case you are not comfortable installing the DIY telematic devices, you can seek professional help at an extra charge.
The telematic devices will help assess your driving habits and patterns.
So drive safe and stay insured!
