Is it Really AI or Just Data Collection?
This article from BuiltIn’s Tammy Xu, explores the difference between what is true AI and what is data-driven insight in the insurance industry. According to Daniel Schwarcz, professor of insurance law and regulation at the University of Minnesota, “[s]ome companies market products as AI-powered but are really just collecting data and feeding it into hand-built models — AI is instead defined by how data is processed after collection, using specific machine-learning algorithms.”
While data collection that is then fed into hand-built models that have assumptions built-in, AI flips that model and “discovers correlations from the data in a bottom up approach.”
What impact does this have on underwriting, the claims process, and other key insurance activities? Click here to read the article.
Reimagining the Claims Process: AI Delivers Meaningful Change
With an increasing number of claims from hurricanes and wildfires, insurers have turned to AI to reimagine the claims process. For Praveen Reddy, CIO, and Head of Operations at Velocity Risk Underwriters, “AI [has the power] to reduce costs enables re-investment in the business, which delivers additional benefit and value to the customer. Meanwhile from a customer’s perspective AI speeds the claims process and enables them to return to their homes and back to normal far more quickly after a catastrophic event, such as a hurricane, fire, or flood.”
You can read the full article here.
AI in the Car Repair Shop: Why Are Owners Not Happy?
Despite the possibilities for streamlining the claims process for both the policy holder and the policy issuer, not everyone is thrilled with the introduction of AI into the claims process. According to a recent story in Wired car repair shop owners are not happy with the use of AI to assess claims. The use of AI in car insurance claims has increased exponentially during the COVID-19 pandemic to reduce the need to have claims adjustors visit repair shops.
While insurers and customers are generally happy with the outcomes from these AI-assessed claims, body shop owners are not. “I’d say 99.9 percent of the estimates are incorrect,” says Jeff McDowell, who owns Leslie’s Auto Body in Fords, New Jersey. “You can’t diagnose suspension damage or a bent wheel or frame misalignment from a photograph.”
So, do repair shop owners have a valid point? Or is this something they’re going to have to grin and bear as the accelerated adoption of AI continues apace?
You can find the answers here.