How GenAI is Improving Claims Efficiency and Customer Experience

May 29, 2024 by

Just over one year into the generative artificial intelligence (GenAI) revolution, businesses in virtually every industry have been grappling with how, exactly, to convert the sizzle around the technology into real-world, practical applications that drive quantifiable results.

While the hype of the last year has caused many skeptics to question whether or not the technology could live up to its promises, property/casualty insurers were among the first to adopt the technology and start applying it to real-world challenges. Now, many are already starting to see the benefits.

That does not mean it’s been easy. In fact, according to our research, although 91% of financial services and insurance leaders say their companies have launched AI proofs of concept, just 36% are using them widely across business functions. Another recent study suggests that 70% of companies are still trying to discern how to reap the potential benefits of AI.

Despite these challenges, a pioneering group of P/C insurance leaders are finding ways to cut through the noise and deliver real results with Gen AI. Following are some of the ways that they’re doing it.

Streamlining the Underwriting Process

Underwriting is a legacy process that has been begging to be improved upon for years. So much of the analysis that goes into decisioning on an individual claim is derived from dusty databases that cull together historical data, past interactions with the client, and other information that would benefit from a technological reorganization. Sometimes these systems are well-maintained, but often, they’re disconnected, clunky and time-consuming to navigate.

With GenAI-powered claims assist technology, insurers are now sifting through chronological claims histories – including notes, call transcripts and related claims documents (incident reports, medical documents, legal documents) – to instantly give claims adjusters and customer support personnel the information they need at their fingertips. Research has already found that this technology is helping to drive a huge reduction in handling time for claims adjusters. In our work with carriers, we’ve seen examples in which claims teams have achieved a 15% reduction in handling time for claims adjusters and a 20-25% reduction in handling time for claim inquiries.

A Smarter Virtual Agent

Insurance customers have been conditioned to do just about everything they can to avoid any kind of chatbot or AI-assisted agent. And up until this point, there was good reason for that. Antiquated technology made automated agent responses nothing more than an obstacle for the customer. But with GenAI, smart agents have taken on a new meaning, as the technology has become more of a complement to a live agent than a replacement, and it’s driving major benefits.

Insurers have started using GenAI copilot tools, which monitor live customer service calls, respond to vocal cues, and automatically search the carrier’s knowledge base for answers to help customer service reps respond in a more targeted, well-informed manner. So instead of parroting, “I’m here, how can I help…,” AI-assisted agents are working in the background of a customer call to help live agents have more productive in their interactions. Already, these solutions are driving reductions in average call handling time, which – in turn – is improving overall customer experience.

Improving Forecasting

While GenAI has brought plenty of meaningful changes to customer-facing employees, it’s also creating a more agile culture at the top of these organizations as well. That’s because, in this era of constant pivots, C-suite employees need to be able to get a sense of the next big disruption to the marketplace, and how that may impact their business. Look no further than the recent trend of automotive coverage – where parts and labor costs exploded, which in turn, sent premiums soaring – to see how vital it is to get ahead of these trends and be able to gameplan for them.

This need looms largest in the P&C market, where anything from inflation and tax policy to construction trends to volatile weather can have an impact on coverage cost. P&C executives recognize this and have started to use GenAI to accurately forecast and conduct scenario analyses based on financial data, macroeconomic trends and other internal and external market factors. This is helping insurers navigate the difficult economic environment and make more proactive decisions on business strategy.

The Next Frontier

As GenAI continues to change the way insurers think about their processes and interact with their customers, they’ll have to be vigilant to stay ahead of the curve. A technology as fluid as GenAI shifts on a seemingly daily basis, and insurers will have to find partners that not only understand the nuances of the tech, but can help put it to work in actionable ways. Those that do will be able to benefit from a more productive and nimble workforce, and higher customer satisfaction marks across the board.

Maheshwari is senior client partner in the global P/C insurance business at EXL, a data analytics and digital operations and services company.