What is Customer Driven Claims Processing?

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Nowadays the insurance industry has become incredibly competitive and commoditized rather than a full service experience. We want to create a positive customer experience in order for these users to stick to our corporate companies. Customer Driven Claims Process is a procedure to investigate and act on a claim that has been filed by a user solely focusing on customers completing the entire process effectively and easily.  Most customers want to be able to settle claims automatically especially below the financial threshold US$1000. This processes tend to work for the simpler and more standardised products i.e. mobiles, car repairs etc. The hackathon wants you to embrace this ideology of looking at standardising most claims processes digitally, using AI and Robotics. The opportunities are endless.

 

What are the different types of insurance that we can look at?

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 Below are a variety of insurance areas that can be transformed into a primarily digital and customer-driven process. We appreciate creativity and diversity so please don’t go for the easiest and simplest option. This hackathon is meant for exploring all paths of insurance and claims!

 

Personal lines insurance

 

Home insurance

Home insurance is property insurance that covers a private residence. It is an insurance policy that combines various personal insurance protection. You might want to consider losses occurring to one’s home, contents or loss of other personal possessions of the homeowner, natural disasters affecting the home (flood, fire, lightning, etc.), falling trees or branches, etc.

As well as liability insurance for accidents that may happen at the home or at the hands of the homeowner within the policy territory.

 

Rental insurance

Rental insurance provides liability insurance. Under it, the tenant's personal property is covered against losses occurring from fire, theft, vandalism, or loss (though it depends on the policy).

 

Health insurance

Health insurance is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. Among the most common health insurance we find are:

• Dental insurance - a form of health insurance designed to pay a portion of the costs associated with dental care

• Income Protection Insurance (IPI) - an insurance policy paying benefits to policyholders who are incapacitated and hence unable to work due to illness or accident.

 

Vehicle insurance

(Car, Bike, Motorbike) is insurance for cars, trucks, motorcycles, and other road vehicles. Its primary function is to provide financial protection against physical damage or bodily injury resulting from traffic collisions and against liability that could also arise there from, or protection against theft.

 

Gadget insurance

Gadget insurance is insurance covering your personal belongings (e.g. mobile phone, laptop, jewelry, camera equipment) while you are in or away from your home.

 

Travel insurance

Travel insurance is insurance that is intended to cover medical expenses, trip cancellation, lost luggage, flight accident and other losses incurred while traveling, either internationally or domestically.

 

 

Commercial lines

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Business insurance

Business insurance provides coverage that protects businesses from losses due to events that may occur during the normal course of business. There are many types of insurance for businesses, including coverage for property damage, legal liability, and employee-related risks.

 

Industrial insurance

Commercial liability and property insurance for heavy industrial premises and properties including plant and machinery which requires regular inspection and is covered subject to risk assessment surveys.

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Cargo insurance

Cargo insurance provides coverage against physical damage or loss of goods during shipping, whether by land, sea (marine insurance), or air. Because of the many dangers inherent in shipping, most individuals and businesses choose to insure their goods while they are in transit.

 

Crop insurance

Crop insurance is purchased by agricultural producers, including farmers, ranchers, and others to protect themselves against either the loss of their crops due to natural disasters, such as hail, drought, and floods, or the loss of revenue due to declines in the prices of agricultural commodities.

 

Marine insurance

 Marine insurance covers the loss or damage of ships, cargo, terminals, and any transport or cargo by which property is transferred, acquired, or held between the points of origin and final destination. Cargo insurance is a sub-branch of marine insurance, though Marine also includes Onshore and Offshore exposed property, (container terminals, ports, oil platforms, pipelines), Hull, Marine Casualty, and Marine Liability.

 

Shipping insurance

Shiping insurance covers goods when they are transported by mail or courier.

 

Aviation insurance

Aviation insurance insures against claims and losses arising from the ownership, maintenance, or use of aircraft, hangars, or airports including damage to aircraft, personal injury, and property damage

 

Cyber insurance

Cyber insurance covers a business' ‘liability for a data breach in which the firm's customers' personal information, such as Social Security or credit card numbers, is exposed or stolen by a hacker or other criminal who has gained access to the firm's electronic network.

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What does AI mean? 

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According to the Oxford Dictionary, Artificial Intelligence is defined as “The theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages.”

 

Fundamentally, AI could be defined as a computing system capable of learning from data. However, the term “artificial intelligence” is often misused.

 

Some of the most common forms of AI are:

 

• Machine Learning: is the science and engineering of making machines “learn.” Human intervention is sometimes required

• Deep learning: is actually a type of machine learning that uses multi-layered neural networks to learn, learning from a larger set of data

• Cognitive Computing: does not have a clear definition; simulating human thought process based on how the brain works.

• Natural language processing (NLP):  Algorithms that process human language input and convert it into understandable representations. (Alexa, Siri, etc.)

 

For the purpose of this brief document, I am going to refer to “AI” as a generic term.

 

AI in the Insurance Industry

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Today, In the insurance industry, AI can handle an increasing number of tasks, including underwriting, claims, fraud prevention, customer engagement and distribution.

Whilst many use cases for AI focus on replacing manual, process-driven activities, AI can now perform tasks formerly considered thought-based, delivering cost savings and efficiencies that go beyond the operational and into the realms of both underwriting and deeper understanding of customers.

Thanks to AI, efficiency can be improved, operational costs reduced, and a more accurate insight into customers can be obtained. Some of the most pertinent examples are listed below:

 

AI and Claims:

The application of AI in claims can reduce time processing, costs and fraud risks.

• Operational intelligence on frequency and severity of loss events: help in creating claims insight, identifying patterns which will lead to improving product design, operations, and distributions.

• Speed of claim process: if historical data are stored, paying out a claim is easier and faster. Also accurate claims process through image analysis and data cross-referencing.

• Compliance: AI can help reduce the cost of litigation by quickly surfacing and interpreting legal and regulatory documentation.

• Fraud control: having historical data can prevent the risk of fraud as the machine can highlight anomalies in the claim process and smarter AI can reduce the number of false positives, which are often immensely costly.

 

AI in Customer experience and distribution :

• Personalised experiences: can be created for customers by harnessing available and historical data so that their interactions with insurers are increasingly individual and unique. This has the potential to improve customer retention and acquisition.

• Sentiment/ emotion analysis; through machine learning and speech analysis: for example, social media data are analysed trying to understand the feeling towards a product or a brand. This gives the opportunity to improve CX and customer retention, allowing insurers to intervene where necessary.

 

AI and Underwriting:

Insurers can use AI to absorb more risk drivers and expand the range of data areas used in underwriting. This capability of collecting new ranges of data could help insurers to price their products more efficiently.

• Automation of underwriting: Due to the large amount of data, part of the underwriting processes are automated through deep learning and machine learning.

• Personalised risk: the large amount of data shows customer preferences, health, and habits. This can help to personalise risk, offering a tailored policy to customers.

• Predictive models: Having historical and real time data can be used to create models capable of predicting risks, fraud etc.

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• Products and needs prediction: with the new capabilities of intuitive AI, opportunities for new products, tailored to individuals, can be spotted and created and sent to customers based on analysis of their needs.

• Robo advisors and ChatBots: offer better intelligence and insight on customer needs offering protection and financial products, for example in the form of a Bot.

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