The use of artificial intelligence to capture information and report claims is providing insurers with the tools to shorten the time between first notice of loss and the final settlement. (Photo: Shutterstock)
At some point in the near future, claims similar to the following could land on a desk near you.
- A water pipe will burst in a bathroom located on the fourth floor of an office building during a holiday weekend. Damage, which will spread to offices located on all four floors, will not be mitigated until workers return to work on Monday.
- After returning home following dinner and a movie, a couple will discover their home has been burgled. Jewelry, a laptop, a digital camera and a crystal decanter are among the items reported stolen.
- Following a night spent having a few drinks with colleagues; a motorist will travel above the legal speed limit after exiting the parking lot and merging with local traffic. A collision with another car will result in damages to both cars, as well as physical injuries.
The use of artificial intelligence (AI) could have prevented or reduced the severity of these claims. For example, after detecting a water leak, Internet of Things (IoT) smart sensors could have immediately sent an alert to the building manager's smartphone. As a result, both damages and claims resulting from the burst water pipe could have been significantly minimized.
As reported on NU PropertyCasualty360, the number of connected "things" has already surpassed the number of human beings living on the planet. This means more than 7.7 billion connected things presently dot the planet.
If the couple going out for dinner and a movie had installed smart sensors in their home, they could have minimized or prevented the claim.
- Outdoor and indoor lighting could have been turned on remotely from their smartphones between the restaurant and movie theater.
- Motion sensors attached to a door or window could send alerts when opened. Some sensors can even detect warm bodies moving through a house or trigger lights when detecting movement.
- Image sensors including digital cameras, camera modules and other imaging devices can record theft and help law enforcement apprehend thieves. This can reduce crime and facilitate the retrieval of stolen goods.
A telematics system installed in the car driven by the overserved motorist during his big night out could have captured his driving history that evening. The device, about the size of a smartphone, would have recorded speed, distance traveled and the time of day the motorist was on the road. The device could also assess his driving style by monitoring braking and cornering, and record the types of roads on which the motorist typically travels, and the times of day and night he tends to drive.
This data allows an insurance company to develop a comprehensive profile of the driver, personalize the risk he creates when driving and price the policy accordingly.
As AI spreads throughout the insurance industry, it could significantly shorten the time between the first notice of loss and final settlement.
Some claims professionals fear they will be replaced by technology. However, the future cannot be ignored and these tools can enhance the process for everyone. By leading the way with intelligence, vision and skill, we can earn our place in an exciting future for the insurance industry.
Gerry Sorge (gsorge@kmrdpartners.com) is a claims advocate at KMRD Partners, Inc., Philadelphia-based risk and human capital management consulting and insurance brokerage firm serving clients worldwide.
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