Management / How the tech revolution is making insurance better for everyone

How the tech revolution is making insurance better for everyone

Innovations in AI are dragging the sector into the future – and making insurance claims faster and easier.

Rather than having to put up with the tedium of being visited by a claims adjustor the next time you have to claim on an insurance policy, imagine being able to simply upload pictures and videos of your damaged home or car to an insurer’s website when making a claim.

Mutual LV hopes to offer just this service from early 2018, which should speed up the process because adjustors won’t need to make physical visits to validate claims.

LV’s Digital Transformation Director Heather Smith says people judge an insurance company by how efficiently it deals with claims and she has asked digital transformation agency TH_NK to come up with new ideas.

TH_NK, which also works with Nando’s, Warner Bros and Britvic, is developing the online photo claims service and is also looking at new ways to use artificial intelligence and machine learning to provide a more personalised service. “Individual customers pose different risks and want different things,” says Smith.

At rival Direct Line, Marketing Director Mark Evans says digital technology is also making it easier to measure the impact marketing campaigns have on the business.

“Social media in particular has given us the opportunity to have a real-time conversation with customers in their channel of choice,” he says. “But digital cannot and should not replace the human factor. We have thousands of people within our operation that know better than any algorithm.”

“Social media in particular has given us the opportunity to have a real-time conversation with customers in their channel of choice. But digital cannot and should not replace the human factor. We have thousands of people within our operation that know better than any algorithm.” – Mark Evans, Direct Line

It seems LV and Direct Line are in the minority when it comes to having a clear digital strategy.

A joint report by recruiter Harvey Nash and consultant KPMG claims that fewer than 15 per cent of insurers are using digital effectively to enhance their businesses. There is still huge resistance internally to change in this very traditional industry.

Yet research by Censuswide claims 25 per cent of UK adults would now trust a robot, such as a chat box, to advise them on a personal insurance enquiry. People aged under 34 are the most comfortable talking to a machine, with men more relaxed than women about receiving automated advice.

The survey was commissioned by IT firm CenturyLink EMEA, and its Director of Insurance Jay Hibbin says insurers must react to how consumer preferences are changing.

“Some time-poor IT teams at insurers have been anti-innovation and risk averse, but by investing in a digital transformation strategy they can meet customers’ expectations and remain competitive,” says Hibbin.

There are some words of caution from the Chartered Insurance Institute (CII) which warns insurers they must use the data generated by digital technology to improve their services and not just to boost profits.

CII’s Director of Policy Dr Matthew Connell says insurance companies must also collaborate to make the industry more efficient.

“Aviva and Ageas showed a great example of this when they reduced the cost and time to handle third party motor claims by launching a new joint claims portal where information is shared quickly,” he says.

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