Severe Storms Have Already Led to $34B in Insured Losses This Year  August 15th 2023

Why generative AI will change the frontline of insurance forever

Now is the time to start making moves in preparation for the widespread adoption of generative AI.

Aliens have landed on planet earth. Figuratively speaking, of course, but that is how big of a deal the introduction of ChatGPT was to the world, our everyday life, and the workplace.

As we move from the initial “shock and awe” phase to putting the technology to work, generative AI is causing ripples across every industry akin to the industrial revolution. The insurance industry is no exception.

From giving frontline agents superpowers and improving customer experience, to reducing costs and increasing customer satisfaction, generative AI is bound to completely change how the business of insurance is done — and the carriers that lay the groundwork now will be the ones to come out on top in the years ahead.

What’s the big deal?

While we saw the internet, PCs and smartphones bring major changes to how people live and work over the past several decades, those technologies do not compare to the disruption of generative AI; it represents the most radical sea change we’ll likely see in this generation. Just like people reminisce now about life prior to the internet, we will soon be wondering how we ever lived without generative AI.

This is good news for the frontline of insurance. For one, the technology, when used correctly, can be surprisingly empathetic–a necessity for our industry. We are still in the early stages, but generative AI has already demonstrated clear opportunities to empower frontline workers to be better at their jobs and more efficient, freeing up time to focus on higher level issues with bottom-line impact.

Jonathan Tushman is the chief product officer at Hi Marley

Gen AI ranks second in top emerging risks for Q2 2023, Gartner finds

Generative AI has made its mark as a principal concern among enterprise risk executives in Q2 2023, based on Gartner’s latest report.

Gartner conducted a survey of 249 senior enterprise risk executives in May 2023 to provide an in-depth insight into 20 emerging risks.

Generative AI has been identified as the second most frequently named risk in the Q2 2023 survey, with third-party viability taking the lead. Financial planning uncertainty was third on the list, while cloud concentration risk followed, and China trade tensions wrapped up the top five.

The Quarterly Emerging Risk Reports offer data on the possible repercussions, duration, attention level, and perceived prospects tied to the mentioned risks.

The top five risks were a mix of macroeconomic and geopolitical volatility, and technology-driven concerns.

Ran Xu, research director in Gartner Risk & Audit Practice, highlighted the first-time appearance of generative AI in the top 10 of their quarterly survey, indicative of its growing public usage and potential risks.

Auto Glass Pros Are Skeptical of Insurers' Use of AIglassBYTEs.com

Many industries are reaping efficiencies from artificial intelligence (AI), and while the technology also holds promise for auto glass companies, it’s currently being met with skepticism from glass company owners who are pushing back against its use by auto insurers.

That’s an insight from myWindshield founder Al Lijee, who assessed AI’s present and future impact on auto glass repair and replacement services in an interview with TechBullion.

“I’ve heard it said that around 15% of insurance claims were settled just by photos before the pandemic, and that figure has since jumped to 60% and will likely go up to 80% or beyond in the next couple of years,” says Lijee.

Many big auto insurance companies, he explains, are now using AI estimation tools like Tractable and Qapter to automate the claims process. The insurance providers say about 25% of all claims are so accurate they don’t need human intervention.

Managers of some auto glass shops, however, are saying that “AI can be wildly inaccurate, leading to disputes where the auto glass technician is kind of stuck in the middle or even being questioned by customers coming in with inaccurate quotes,” according to Lijee.

He says the “big challenge” moving forward is to avoid “using AI as a crutch for all quotes.”

“We don’t want to rely heavily on the quotes from AI or endorse them, but rather we want the auto glass shop to be able to intervene and apply their expertise in cases where it’s inaccurate,” he adds. “If a big chunk of quotes are spot on, this tool can be very useful for customers and auto glass shops alike, saving time going back and forth sending photos of the damage to their windshield, for example.”

AI provides the edge that insurers need in general liability

General liability claims in commercial insurance can arise from accidents or incidents during business operations. These claims are typically filed against businesses for injuries or damages sustained by third parties, such as customers, clients or other individuals.

In this article, we will focus on liability claims resulting from injuries suffered by these third parties and how insurers can utilize artificial intelligence to help minimize the amount paid per claim while treating the injured party fairly.

Injury claim types

Many incidents can lead to bodily injury claims. Some common types of incidents that generate general liability claims include:

• Slip-and-fall accidents: These accidents occur when someone slips, trips or falls on the business premises due to wet or slippery surfaces, uneven flooring, poor lighting, or other hazardous conditions.

• Other bodily injuries: If a third party sustains injuries on the business premises or due to the business operations, they may file a general liability claim. These accidents can range from construction site accidents, product-related injuries, fire and explosions to accidents involving machinery, equipment and others.

• Completed operations: Claims can arise from injuries or damages after a business has completed a service or project, such as faulty workmanship or installation.

Many of these hazards and the injuries they cause seem preventable, but eliminating them can be cost-prohibitive. General liability insurers and companies that self-insure need means at their disposal to minimize the impact of claims when they occur. In today’s world, increasingly, the answer to this problem is artificial intelligence (AI).