5 Ways Technology Is Changing the Insurance Industry

It is natural to connect technology and artificial intelligence with industries such as telecommunications, marketing, and manufacturing. In the insurance sector, maybe not so much. Customers still receive cards in the mail, meet agents in their offices, and talk to adjusters about their complaints. However, technology is changing the way insurance carriers provide coverage and the way policyholders receive coverage.

Advances in technology have begun to automate and predict insurance operations, from underwriting claims to changing how policies work. As the industry integrates things like artificial intelligence, machine learning, and other technologies, the relationship between service providers and customers is also changing.

High efficiency and data analysis will never take away the human touch. However, these improvements will increase accuracy, make information more accessible, and may improve customer communication. From the perspective of insurers and customers, here are five ways tech is changing the insurance industry.

1. Artificial intelligence is providing faster simulations.

Most of the time when a law enforcement officer records a motor vehicle, a supervisor is required to be present to see the damage to the vehicle. Customers initiate a claim online or over the phone and must wait for the adjuster to contact them. The repairman looks at the car, sees the defects and damages, and comes up with an estimate. That estimate can take several days, extending the time from the customer’s first contact to payment.

At this point, the buyer is either without their vehicle or stuck in a vehicle with visible damage. Artificial intelligence is speeding up the time it takes for insurance carriers to issue and process estimates. Instead of waiting for a repairman, policyholders can use software to immediately take pictures of the damage they need to repair. An AI-based algorithm it comes with an estimate within seconds. This allows insurance companies to get money from policyholders or make repairs in a timely manner.

2. Telematics is a payment option.

Telematics may not be a familiar term to many insurance customers. But they can find out about these upcoming auto insurance rates from their carriers. Some insurance providers send bill messages and emails touting new technology that tracks customers’ driving habits. It’s a monitoring device that goes into the car and records the driver’s habits.

These devices are used to collect data, including location, speed, distance driven, and accidents. Insurance carriers then use this information to determine their premiums. In fact, aggressive drivers and those who cut long distances can end up paying more. Careful customers and those who drive less pay lower prices. Telematics facilitates risk assessment for service providers and rewards drivers with good reputations.

3. Drones are assessing the damage.

In general, the use of drone technology is increasing in many industries. The forecast shows that the market will reach a higher price $63 billion by 2028. Statistics also reveal that the annual market growth from 2021 to 2028 will be approximately 16%. Insurance companies are already supporting this growth by using drones to assess damage. Homeowners who file complaints about roof damage or hurricanes may soon be surprised to see a drone flying over their property.

Instead of relying on roof inspectors, insurance carriers can deploy drones to take pictures of snow and wind damage. Using drone technology increases efficiency, accuracy, and safety. Rescuers can use drones to reach hard-to-reach areas after a major storm. This technology also has the ability to capture damage from inaccessible or hazardous locations that humans cannot reach.

4. Machine learning to create automatic claim forms.

Filing a claim after a car accident or serious accident can be overwhelming. Anxiety and nervousness can make it difficult for clients to remember important things, such as the time of the event. Reading the details of the form online or in person can be overwhelming for the law enforcement officer and often creates anxiety. However, insurance carriers often emphasize the need to file a claim immediately.

Machine learning removes some of the problems that customers may face during the application process. Humanized forms that contain data from customer history and processes eliminate the need to repeat information. Machine learning reduces potential errors during coding and increases efficiency. Even small claims like windshield repair are changed when contractors bill customers using their numbers.

5. Social media makes it easy to reach customers.

No one wants to wait or spend hours wondering if the insurance agent has their message. Before social media and chatbots, this was a reality for law enforcement who waited on the phone. Asking a question, trying to get a new policy, or changing an existing one can take weeks. But now that insurance carriers are on multiple platforms, getting customer support has become easier. Chatbots and emails can also be ways for customers to get help when they need quick answers to things like issues and questions.

Research shows that messages are now he is number two among the customer service methods used by consumers. Chatbots and instant messaging on social media can handle questions about updating addresses, changing deductibles, and filing complaints. Customers can send direct messages on social media and get same-day responses. In most cases, carriers can provide answers within minutes or get the ball rolling. Satisfaction increases when customers receive better service.

Technology in the Insurance Industry

Advances in technology are affecting the way customers and businesses communicate with each other across multiple industries. Insurance is one of them, as carriers integrate technologies such as AI telematics, and machine learning into their businesses.

Both service providers and customers benefit from these changes as coverage and services increase. Not to mention simplifying the process and increasing availability. Human relations will still play an important role, but technology will exist and will continue to play a role in uplifting all customers.

Image Credit: David Peinado; Pexels.com. Thank you!

Brad Anderson

Editor in Chief at ReadWrite

Brad is the editor who oversees the content presented at ReadWrite.com. He previously worked as an editor at PayPal and Crunchbase. You can reach him at brad at readwrite.com.