Reportedly, Ai and ML are also being used to improve risk management in the insurance sector

By Pankaj Vashishtha

Every industrial landscape has been rapidly changing due to the expanding reach of automation, and the insurance industry is no exception. Due to its significant role in increasing productivity and lowering costs, this industry is swiftly catching up to the AI bandwagon. AI and ML are revolutionizing the industry, transforming the way insurers operate and interact with customers. These technologies enable insurers to streamline processes, reduce costs, and improve customer experience.

AI and ML have the potential to transform the insurance industry completely. The conventional approaches to risk analysis, fraud detection, and claims processing are time-consuming, ineffective, and often inefficient. However, with the help of AI and ML, insurers can analyze massive volumes of data in real-time, spot trends and anomalies, and create more complex models for fraud detection, risk assessment, and claims processing.

Additionally, AI and ML enhance consumer engagement and experience by allowing insurers to customize goods and services to meet specific customer needs and preferences, offer real-time assistance, and respond to customer questions via chatbots and virtual assistants. As these technologies continue to evolve, we can expect to see even more innovative applications in the insurance industry.

Fraud Detection and Prevention

Insurance fraud is a major concern that costs insurers billions of dollars every year. Manual reviews are one of the more time-consuming and frequently inefficient traditional fraud detection techniques. In order to evaluate huge amounts of data in real-time, increasingly advanced fraud detection and prevention systems are being developed using AI and ML. With these tools, insurers can see trends and anomalies in the claims data and stop fraudulent claims before they are paid out.

Risk Assessment and Underwriting

The methods for risk evaluation and underwriting in the insurance industry are changing thanks to AI and ML. In the past, insurers have calculated premiums and assessed risk using manual procedures. But in order to effectively evaluate risk and determine rates, AI and ML systems can now examine massive amounts of data, including demographic data, claims history, and behavioural data. Additionally, insurers use AI and ML to automate the underwriting process, which saves time and money when processing applications. As a result, customers may receive their orders more quickly, and insurance costs may go down.

Customer Service and Engagement

Customer service and engagement in the insurance industry are improved with the use of AI and ML. Artificial intelligence-powered chatbots and virtual assistants can offer customers immediate assistance and responses to their queries. These chatbots can answer basic questions, freeing up human agents to handle more complex problems. Additionally, by customizing goods and services to suit each client’s requirements and preferences, AI and ML can be utilized to enhance consumer experiences. This can raise customer retention rates and promote customer satisfaction and loyalty.

Claims Processing and Management

Another area where AI and machine learning are transforming the insurance industry is claim processing and management. Insurance companies use AI and machine learning algorithms to automate claims processing, saving time and money. As a result, customers will receive their payments faster, and insurance costs may decrease. Furthermore, data on claims can be analyzed using AI and Ml to discover patterns and trends. This can help to reduce the likelihood of claims being denied, and insurers can use this data to identify areas where their claims procedures can be improved.

Predictive Analytics and Risk Management

Ai and ML are also being used to improve risk management in the insurance sector. Predictive analytics algorithms can analyze vast amounts of data to identify potential risks and predict future events. This can help insurers to develop more effective risk management strategies and reduce the likelihood of losses. For instance, insurers can use predictive analytics to identify customers who are at a higher risk of making a claim and develop targeted interventions to reduce the likelihood of a claim being made. This can lead to lower costs for insurers and better outcomes for customers.

Future of the Insurance Industry!

The insurance industry is evolving due to the advent of AI and ML, which enable insurers to improve customer experience, cut costs, and streamline operations. AI and ML are employed in various applications in the insurance industry, including fraud detection and prevention, risk assessment and underwriting, customer service and engagement, claims processing and management, as well as predictive analytics and risk management. Hence, one can anticipate even more cutting-edge applications in the insurance sector as AI and ML develop. As a result, it is evident that the insurance industry is poised to prosper in the coming years if it adopts these technologies and changes with the times.

The author is co-founder and CEO, Policy Ensure

The insurance industry will have to come together and campaign in a big way to create an awareness like the mutual fund industry so that the rural population, especially farmers, come forward to avail of cattie, tractor and other insurance schemes, said Rahul Mishra, Co-Founder and Dir-ector, Policy Ensure.

“The moment the government intervened in favour of the mutual funds industry expansion took
place. It created a lot of aware
A small town like Gorakhpur in Uttar Pradesh contributes Rs. 2.3 crore a month. The insurance industry has to do a similar campaign.”, said the co-founder of Policy Ensure, which was launched in 2016. Policy Ensure is a digital insurance “phygital” platform catering to tier 2 and 3 cities and towns.

EXPANSION
Policy Ensure, which is present in Maharashtra, Odisha and Sharkhand, plans to expand to central and southern parts of the country over the next 6-12 months.
The company plans to have a distribution force of 50,000 to one lakh over the next 2-3 years. Policy Ensure does cattle and tractor insurance for farmers, though it is dependent on the insurance companies. “A lot of catching up is needed in the cattle insurance front. It is not happening at the scale it should.” Mishra said.

Only rich farmers insure their belongings. “Small and marginal farmers do not have the money to insure their cattle or other belongings,” he said. Tagging of cattle for insurance is another issue. Also, insurance of cattle or crops by farmers is “highly political” and politicians try to influence the decision on the payouts.
Insurance companies themselves do not encourage covering these risks, though they can be covered and prob lems settled without any is sues using technology such as drones. “Also, today there are not enough veterinarians available to tend to the animals in the case ofcattle insurance,” he said.

Several changes will take place in insurance sector from April 1, 2023. This includes removal of tax free advantage from savings insurance plans whose annual premium is above Rs 5 lakh and omission of commission cap for insurance agents. These changes will impact people in a number of ways.

Health insurance is a form of insurance that covers medical expenditures incurred by an individual for long-term well-being. Ultimately, health insurance policies allow individuals and families to cover the high expenses of medical treatment. There are tax advantages to purchasing and having health insurance coverage. The premium amount paid for health insurance is tax deductible. Section 80D of the Income Tax Act allows you to claim tax benefits on your health insurance premiums. As a result, based on an interview with various industry experts, here’s how you can get tax breaks on your health insurance premiums.

General insurance benefits provide a blanket of financial protection from the uncertain risks posed by medical emergencies, diseases, accidents, and more

In times of uncertainty or emergencies, arranging a substantial amount of cash instantly can turn out to be a liability for an individual. General insurance in such cases provides a blanket of financial protection from the uncertain risks posed by medical emergencies, diseases, accidents, and more. With the right insurance at your disposal, you get reimbursed in such situations, which makes it a lot easier to manage the heavy expenses.

However, as understanding insurance policies can be complex, not everyone can procure maximum benefits out of them. But there are certain measures you can take to utilise it in an efficient manner.

Right policy, more benefits

Today, health problems have become way more common in senior citizens and younger people alike. With the increasing costs of treatments, medicines, and diagnoses, it is better to have a general insurance policy at your disposal. However, choosing the right policy can and will help procure the complete benefits. You need to check your requirements first. While someone may have individual requirements, on the other hand, some people may require a family floater plan. Furthermore, a high claim settlement ratio can help increase the chances of getting a claim.

Knowing the coverage

Purchasing general insurance for yourself and your loved ones is an optimal thing to do in order to live a stress-free life. However, before getting a policy, reviewing and knowing the limits and exclusions carefully is also necessary. Insurance coverage can be considered a financial safety net. It is a financial protection that is given to the insured in case of any adversities. The premium you pay sets a limit for your coverage, and you cannot make claims exceeding this particular amount.

Knowing this will not only help you understand the policy in a better manner but will also aid in making informed decisions. The information can be garnered with the help of an insurer or an agent, who can help you understand the necessary details before the purchase.

Going cashless

In this era of digitalisation, we have the provision of going cashless, and general insurance is no exception. Several insurance companies in India are offering cashless facilities. As the name suggests, the insurer does not have to pay a rupee from their pocket while their medical expenses are taken care of.

A cashless claim has its own benefits and convenience when it comes to medical emergencies, which usually take a toll on the patient and their family. With cashless general insurance, the insurance company deals directly with the hospital, as they have their own established networks. Therefore, going cashless is a good option in order to avoid any unnecessary expenses.

Choosing network hospitals

One of the common pain points in general insurance is when a policy does not cover all the expenses and the insurer does not cover 100% of the claim amount. A lot of the time, a patient or their family might not understand the situation, but the bill post-hospitalisation can come as a shock. However, this can be avoided with a planned hospitalisation. The insurance providers give you the option of choosing from a network of hospitals.

These network hospitals are verified, they provide quality treatment, and they ensure that the policyholder gets a discounted rate as they have agreements with insurance companies. Knowing this can save a lot of expenses, however, you must also check out the breakup costs in order to know which hospital suits you best. This information might not be readily available, so you need to approach your insurer or an agent to learn more.

Taking the provision of preventive services

There is no doubt you can plan for an emergency; however, you can be strategic about the timing of your planned check-ups and screenings. Preventive care or routine care helps a person detect a disease or any medical problem that can become daunting for them later in their lives.

Several general insurance benefits providers include coverage of preventive care in their policies. Therefore, before purchasing the insurance, you must get this benefot included so that you can save on any sudden out-of-pocket costs. This can include any annual check-ups, screening for conditions, immunisations, or more. Utilising this benefit can not only help you live a healthy life but also avoid any costly medical bills.

Learning to claim promptly

In some cases, policyholders are reluctant to report an insurance claim, but that can lead to heavy costs in the end. If you fail to report a claim properly, it can be a violation of the policy and might result in the claim being rejected by the insurer. Promptly claiming in such a case allows insurers to act quickly and minimise the losses as much as they can. The sooner the claim is managed, the better, as it will cost less. If you want your insurance policy to work for you at the right time, prompt reporting of claims gives you this benefit. For this, it is necessary to make sure that you provide all the necessary documentation to avoid any delays or denial of benefits.

Using telemedicine services

Telemedicine is a convenient and affordable way to receive diagnoses, consultations, and treatment. Owing to its impeccable results in pandemics, telemedicine’s popularity has gained traction. Whereas regular consultations with a medical professional are permitted under the terms and conditions of the policy contract, the Insurance Regulatory and Development Authority of India (IRDAI) has requested that the insurer permit claim settlement for telemedicine consultations. Hence, you can select the policy that provides coverage for telemedicine to avail the benefits.

All things considered

By taking care of yourself and adhering to best healthcare practices, you may be able to reduce your chances of becoming ill and developing chronic diseases. It is captivating that insurance companies might also give such policyholders discounts on premiums or other rewards for following a healthy lifestyle. As a result, it may be lucrative for you in every sense. However, as an alternative, General Insurance Benefits are a tool that can help you maximise your wellness. Furthermore, this is only possible if you take full advantage of its benefits. To do so, you must be aware of your policy, use cashless facilities, use preventive services, select network hospitals, and submit claims on time.

Furthermore, before purchasing any policy, you must take some time to filter it and have a clear understanding of which plan will suit your needs the best. When in doubt, it is always better to get an expert opinion, as it can not only save you time but also ensure that your insurance needs are fulfilled in a hassle-free manner.