What companies come to mind when you think about technological advances? Apple? Amazon? Google? Insurance may not be an industry that automatically comes to mind. However, the wind is changing! Insurance carriers are more receptive than ever before to adopt technology to improve the services they offer. Below are some examples of how the insurance industry is utilizing technology.
- Drones– What is one of the first questions you ask after filing a claim? Is it “When will an adjuster be coming out to complete an inspection?” With the deployment of drones, insurance carriers are able to assess the damage quickly, easily, and safely which results in a lower claims cycle time which ultimately results in a more timely payment. VP of property claims at Travelers, Jim Wucherpfenning, states: “We do use them for response to catastrophes, but we also use them for all other types of claims situations, both commercial and residential, as well as risk control.” (Claims Journal).
- Wearable Technology– Travelers is partnering with contractor, Gibane, to use a wearable device, Spot-r Clip, to aid in safety at construction sites. The Spot-r Clip is attached to the worker’s belt in order to provide real-time information. With the push of a button workers are able to notify their supervisors with their exact location. Not only does this device detect a fall but it can also measure impact and acceleration. Temperature, humidity, and other workers around the accident location are other valuable information that the Spot-r Clip can provide. Health and life insurance carriers have pioneered the way, using data gathered from these wearable devices to better underwrite and provide incentives for consumers to manage their health.
- Telematics– Insurance carriers have and are continuing to use telematics to provide incentives to consumers by offering discounts for low mileage and safe driving. Telematics providers such as Cambridge Mobil Telematics, Zendrive, and ConnectedTravel gather vehicle performance and even phone usage data in order to provide insurance carriers valuable information in order to reward safe drivers and properly rate higher risk. One company that incorporates telematics in their premium determination is Nationwide. Their SmartMiles program allows consumers to control their insurance premiums based on the miles driven and the quality of driving through their SmartRide program.
- Chatbot Technology– Chatbot technology allows for communication between artificial intelligence and humans using a computer software program. The best aspect of this program is faster response from customer service. London start-up, SPIXII, is an example of a chatbot designed to make the process of obtaining insurance coverage hassle-free. Claims is another area that can greatly benefit from chatbot. For example, Lemonade which is a new insurance startup utilizes a chatbot by the name of Jim to assist in the settlement of claims in as little time as 3 seconds!
- Blockchain– Insurance carriers are exploring blockchain to assist in fraud detection as well as a tool to increase efficiency when dealing with sensitive information. With blockchain, claims could be permanently recorded on a shared ledger. As a result of the shared ledgers, presenting several claims for the same loss or fraud could be detected as well as prevented. Another benefits of blockchain is security of data that can be shared across a network. This is crucial when facilitating transfer of information between health professionals and insurance carriers.
- Augmented Reality– USAA is one carrier taking the plunge, providing an app for their customers to assist in the vehicle purchasing process. Just by pointing the mobile device at a vehicle, as long as the vehicle is 2000 or newer, insurance premium and purchase price are displayed using this app. Another example is Allianz, a world-wide known UK insurance company, who created the “haunted house” experience. Capitalizing on augmented reality, Allianz created a pop up building for visitors to identity possible dangers. As visitors are going through the home, an iPad with the augmented reality app is used to identify possible accidents such as a smoking and sparkling toaster, breaking the bathroom floor caused by sink floods, cracking aquarium, etc.
- Social Media– According to the Coalition Against Insurance Fraud, $80 billion is incurred each year as a result of fraud. What most people do not realize is that everyone is penalized as a result including the person committing the fraud. Premiums are increased to balance out the number of claims being paid out; therefore, driving up the cost of insurance for everyone. Per Statista, more than 75% of Americans have at least one social media account. An individual’s profile or that individual’s friends and family’s profile contains a wealth of information. The Claims Journal provided a real life example of an individual who claimed she sustained an Achilles tendon injury while performing her job duties. She was, in turn, seeking a large payout. Upon investigation of her social media posts including a blog, the carrier was able to discover that the claim was fraudulent.
Be encouraged that insurance carriers understand the need to keep up with the times. Competition in the market is pushing carriers to find new ways to stand out, which ultimately benefits you as the consumer. “Accenture found that 63 percent of insurance executives say the industry will be completely transformed by intelligent technologies, and 53 percent are already using them in one or more business process. The firm estimates that investments in intelligent solutions could increase annual profitability for U.S. insurers by $20 billion.” (Shelly).
(2012, November). Allianz: Haunted House. Retrieved from https://adage.com/creativity/work/haunted-house/29902?
Johnson, Denise. (2018, July). Insurers’ drone use picks up after 2017 hurricane season. Claims Journal. Retrieved from https://www.claimsjournal.com/news/national/2018/07/19/285858.htm?
Johnson, Denise. (2018, November). Tracking construction worker safety a group effort. Claims Journal. Retrieved from https://www.claimsjournal.com/news/national/2018/11/26/287994.htm
National Association of Insurance Commissioners. (2018, December). Artificial Intelligence. Retrieved from https://www.naic.org/cipr_topics/topic_artificial_intelligence.htm
Park, Jason. (2018, October). 4 tips to successfully use social medial discovery to prove insurance fraud. Claims Journal. Retrieved from https://www.claimsjournal.com/news/national/2018/10/02/286988.htm
Sams, Jim. (2019, April). Chatbots growing role in insurance includes claims. Claims Journal. Retrieved from https://www.claimsjournal.com/news/national/2019/04/03/290177.htm
Shelly, Jared. (2019, January). Here’s how artificial intelligence is poised to transform insurance underwriting for the better. Retrieved from https://riskandinsurance.com/ai-transforms-underwriting/
Stock, Kyle. (2019, April). Getting Americans to stop using phones while driving. Insurance Journal. Retrieved from https://www.insurancejournal.com/news/national/2019/04/29/524972.htm
USAA Community. (2018, September). USAA makes car buying easier with new augmented reality app. Retrieved from https://communities.usaa.com/t5/Press-Releases/USAA-Makes-Car-Buying-Easier-With-New-Augmented-Reality-App/ba-p/187772
Wraight, Patrick. (2019, April). 4 insights from the conference I just attended. Insurance Journal. Retrieved from https://www.insurancejournal.com/blogs/academy-journal/2019/04/17/523993.htm
Abigail Jenkins has worked in the insurance industry for almost 10 years. She has achieved numerous professional designations including Associate in General Insurance (AINS), Associate in Claims (AIC), Charted Property and Casualty Underwriter (CPCU), and is currently pursuing her Certified Insurance Counselor designation. She has worked both on the agency and carrier side which has provided her with working knowledge of risk management as well as claims handling experience.