The insurance industry is beginning to feel the impact of AI as it automates processes and enhances customer service. With a projected market size of $58.5 billion by 2030, AI is set to revolutionize the sector. The key applications of AI in insurance sector include fraud detection, risk analysis, and claims settlement automation.
Cognitive Market Research has done a piece on AI in the insurance market and as per that it is estimated that Global AI in the insurance market will have a size of 58.5 billion dollars in 2030. The compounded annual growth rate from 2023 to 2030 will be 32.16%.
Experiments are being carried out in different parts of the world as we speak. So far it is understood that Generative AI will impact property and casualty insurance the most.
Second on this list in terms of impact from AI would be health insurance, and life insurance will be the least affected. Slowly-slowly AI will take over quite a few aspects of insurance in the next three years.
In 2021, Global AI in insurance market sales revenue stood at 2.72 billion dollars. To estimate this number will go up to almost 60 billion dollars shows the potential of AI in the insurance industry.
Understanding AI in Insurance
AI in insurance sector is becoming common. All the paperwork, meetings, waiting for approvals, and other terms associated with insurance are being taken out the door as AI is automating these time taking processes. Apart from automating businesses, AI is also bringing back people’s trust in this industry.
The key applications of AI in insurance are:
- Detecting fraud and analyzing risks which would help the companies to provide accurate information to their customers as human error goes down.
- Providing better customer service which doesn’t just make the process easier but also quicker when it comes to settling claims.
- The process of Underwriting becomes easier and less human I intervention is required.
- The machine learning algorithm allows the AI to learn as it works and this helps to offer tailored pricing and services.
- Claims can be settled faster when AI is allowed to intervene and automate the process.
- Chatbots can help with a lot of things like dispersing information and collecting data. This would reduce the load on human employees thereby giving the insurance industry a new look.
- AI can quickly access the damage and predict the potential loss and make quick recommendations for the same.
There are quite a few insurance companies that are already using AI. Lemonade uses AI chatbots for claim processing, ZestFinance for risk assessment, and Nauto for forecasting. And before long others will follow the suit.
Source: Cognitive Market Research Report