Insurance Australia Group (IAG) is applying AI technology to parts of its operations to reduce claim handling times and produce better customer outcomes.
Speaking at FST Media’s Future of Financial Services Sydney 2020 conference, Chief Analytics Officer Bora Arslan said IAG hopes the technology will optimise its core business operations, create new customer experiences, and potentially generate new business.
IAG is using AI technology to help identify who is responsible for a motor vehicle accident, to personalise the insurance quote process, and for operational analytics including pricing.
The company is also using natural language processing technology to predict if a car is too expensive to repair. According to Arslan, AI substantially quickens this process compared to traditional manual assessment.
“What we’re doing is using natural language processing to look at the details of the claim lodgement,” said Arslan. “We’re looking at the dialogues going on between the customer and our agents, we’re collecting a lot of additional information, we’re looking at a lot of additional reports, and we’re using a lot of insights there to determine the likelihood of that claim turning into a total loss.
“With that work we reduced that lengthy process of total loss right now to just a couple of days, and it’s proven very pleasing for our customers,” added Arslan.
“In normal circumstances it takes a lot longer than two weeks for customers to find out that actually their car is not coming back to them. Altogether, with the settlement and everything, it’s very lengthy,” said Arslan. “The total loss is not necessarily the most pleasing customer experience unfortunately when it comes to general insurance. We only give our customers two weeks of rental car when they make a claim with a damaged car that needs to be repaired.”
Several insurance companies have either announced or been revealed to be adopting and using AI extensively as part of the claims process. BodyShop News has recently reported on MS&AD Insurance Group, and previously Admiral Seguros in Spain and the Indonesian subsidiary of Tokio Marine, another Japanese insurer, being signed up to British tech company Tractable’s AI technology suite.