An overview of the impact of robotics on the insurance industry
With the rise of robotic process automation (RPA) in insurance, many companies now have the opportunity to implement artificial intelligence systems to automate work. In recent years, we have also seen fundamental shifts in the workplace, with most employees now working remotely, often taking advantage of more streamlined ways of doing their work. The use of robotic automation in insurance and the wider business world has a range of benefits, and the RPA market is growing well. It’s been predicted that the global robotics market will grow at around 26 per cent to reach just under $210 billion by 2025. RPA has proven productive in several ways and below, we introduce a few brief case studies of its impact on insurance.
AI and the future of work
AI is transforming an array of different areas in insurance, such as customer service, financial reporting and fraud detection. Research by global professional services firm Genpact has found that 87 per cent of insurers are investing more than $5 million in AI-related technologies each year. Shift Technology, based in San Francisco, is one company that uses AI-driven fraud detection software known as Force – and many companies, including Falcon Insurance have been using the software as their provider. Force analyses data from different sources and provides a score for each claim to help uncover suspicious activity more accurately.
Shift Technology has made it easier for insurance companies to identify fraud and how best to solve the problem. Other companies like Fukoku Mutual in Japan run IBM’s “Watson” AI software to help with their customer engagement challenges. The IBM software was designed to understand customers’ voices, so they can interact with the system. While jobs will certainly be transformed, technology will not replace human labour entirely. As a result of RPA, new jobs will be created to manage the demand for new technology and improve processes. Insurers should be ready to tackle the ongoing digital transformation and balance automation with the human touch.
Underwriting is another key area of insurance that is rapidly changing as a result of automation and technology. The accuracy and efficiency of this are hugely important because an insurance company’s profitability is dependent on a precise risk assessment. Therefore, underwriting has long been ripe for automation. Swiss Re in Zurich collaborated with Milliman IntelliScript to create an automated underwriting solution. Known as Magnum, it’s designed to help insurers capture data more seamlessly and as a result, simplifies the whole process.
Data and claims processing
The importance of effective insurance claims management is key. Having a sufficient claims process can save time for companies and ensure any issues are solved as quickly as possible. RPA is having a profound effect on claims. The traditional process requires the collection of large amounts of data and documents, but automation can streamline this. Insurance company Lemonade uses AI and machine learning to manage its claims relying on a chatbot that asks users questions. The AI software analyses the information and flags potentially fraudulent activity; much like a real-life claims agent, only much faster. Quite simply, there are huge incentives for adopting robotics and automation in insurance and other sectors.
Hanover builds executive teams in the insurance industry
There’s no doubt that robotics and automation are reinventing the insurance sector and companies within this industry need to be ready to adapt to the changes. Hanover’s executive search specialists are well equipped to help insurance companies recruit the best talent to ensure the continued growth of their businesses. Contact us today to find out more about how we can help your recruitment and keep reading our articles for new industry insights.