Sprout.ai, an artificial intelligence (AI)-powered claims automation and fraud detection company, has made its predictions for the insurance industry for the coming year.
Its CEO, Roi Amir, and Head of Product and Solution Engineering, Greg Adams, have made four key points.
The first focus for the new year is generative AI, which can create content in various formats.
Amir said: “Generative AI will continue to be a focus for the insurance industry in 2024. We will start to see the transition from hype and AI being viewed as a magic solution to all problems to a real, in-production solution to some very specific problems. Some of the key hotspots will be marketing, customer service and claims management and automation.
“There is the potential for a rise in fraudsters using generative AI as a tool to fake evidence in a convincing way. As more sophisticated tools fall into their hands, we will see the development of tools that can identify such in an effective way.
“We will inevitably see the creation of insurance products and policies that handle the cybersecurity risks created by AI. With an increase in the role of generative AI throughout businesses, companies will need to ensure they are mitigating the chance of mistakes made by AI or its implementation.”
Funding in insurtech
The next prediction is an increase in funding for technology in the insurance industry.
“After a tough economic environment in 2023, the markets are expected to improve in 2024,” said Amir. “The tough economy we saw in 2023 has created a natural selection process. Companies that have managed well through this period will expect to see valuation increasing and more investment coming in. With expectations for inflation and interest rates to stabilise and reduce towards mid-end of 2024, it is likely that we will see funding start to pick up again.”
Amir’s last suggestion is a more personalised client experience for insurance customers.
He said: “The role of the claim handler is evolving and in 2024, I anticipate that we will see a rise in no-touch and low-touch claims. Both insurers and customers are fearful of handing over complete control to AI so claim handlers need to start preparing for the future. The focus of a claim handler will change to handling more complex claims and providing good and personal customer care to the policyholder.”
Adams’ prediction includes a fully digitalised insurance experience, which evolves through current practices rather than complete change.
He said: “As we enter 2024, we’re not far off from cracking a completely end-to-end digital insurance experience, but the insurance industry is all about evolution, not tearing up the rulebook. So, the ongoing battle between legacy providers and disruptors will undoubtedly continue in 2024, despite technology providers being much more integrated within the industry as a whole and possessing a greater understanding of the ecosystem. Ultimately, the rising consumer demand for new technology and an improved claims experience will surpass this resistance and drive more ambitious innovation in 2024.”
He also suggested what kinds of new technology could be on the horizon: “Image analysis for claims data will be an area of exciting innovation, which has been so far limited in its use for claim automation until some of the latest innovation from OpenAI and Google have made image insights more readily available. We should also see the use of AI to draft the rules for claims scenarios to help diminish the rising cost of claims. Technology providers are now less focused on introducing tech such as AI to the industry; they’re considering how this tech can be leveraged in smarter and more impactful ways.”