Artificial intelligence will become a “big time saver” for claims adjusters and will eventually allow the industry to save billions a year in costs, one researcher says.
For auto claims, insurers are already using AI to make recommendations on whether damaged vehicles should be repaired or scrapped, said Nick Maynard, a senior analyst for Juniper Research Ltd., in an interview. “At the moment, a lot of these applications won’t be fully autonomous,” he said. “They will make a recommendation, and this will be analyzed by a trained appraiser or somebody at that insurer.”
Maynard wrote AI in Fintech: Roboadvisors, Lending, Insurtech & Regtech 2019-2023, a report released Feb. 20 by Basingstoke, England-based Juniper Research.
Worldwide, AI will lead to cost savings of almost US$1.3 billion by 2023, up from $300 million in 2019, Juniper said in the report.
That is the annual savings not for the entire industry but only for the motor, property, life and health insurance sectors, Maynard said.
Some software use AI to estimate auto physical damage claims, Maynard said, citing London, England-based Tractable Ltd. as an example.
“A lot of computer analysis tools, for decades, have been able to produce a report when things meet certain criteria and that is a traditional rules based system, but the AI system is learning to set those rules itself and understand when those rules are applied,” said Maynard.
“It will actually be a big time saver,” Maynard said of the use of AI in estimating insurance claims. “The very nature of AI is the more it is exposed to the better it becomes at the task that it is being applied to. I think over time it will move into a fully autonomous role and you will see fully autonomous claims settlement.”