4 Ways Chatbots Redefine Insurance Processes

By Insurance CIO Outlook | Monday, November 04, 2019

AI and ML technologies have reformed information systems well by making them much more human-friendly while significantly improving human-computer interaction.    

FREMONT, CA: With the increasing popularity of messaging platforms, as well as advances in Artificial Intelligence (AI) and Machine Learning (ML), the development of chatbot for a range of business needs is increasing. AI opens numerous possibilities to change the way the insurance business operates. Chatbots are the most discussed revolutionaries in various industries. For insurance companies, chatbots are the best alternatives to optimize their services. Smart chatbots are bound to offer more use cases for the insurance industry in the years to come. Here are a few reasons why chatbots should be introduced by insurers to ensure smooth insurance procedures.   

Automated Claims Processing

 Artificial Intelligence -based chatbots can be implemented to boost claims processing; the touchless insurance claims processing, powered by AI, will eliminate unnecessary human intervention and report claims, capture injury, upgrade the system, and communicate with the customer on its own. Such an effortless process would allow customers to file their complaints without much trouble. For example, an AI-powered claims chatbot may review the claim, verify policy details, and transfer it through an algorithm for fraud detection before sending instructions to the bank to pay for the claims settlement.  

Virtual Assistance 

Customers might develop a phobia due to lengthy reports, complicated plans, and repetitive directions, and get confused and daunted about the prospect of paying for an insurance policy. Intelligent chatbots surpass the capacity of insurance agents and act as a virtual assistant in messaging applications on customer devices. For a thorough understanding of customer questions, chatbots are powered by NLP along with sentiment analysis to determine the reaction of a customer and solve problems accordingly. Customers can either type or use their voice to communicate their concerns about various policies that can be processed by chatbots to deliver customized solutions.   

Customer Experiences

There is the constant talk of man vs. machine with the rise of bots. Chatbot communication is a great opportunity for customer service teams to enable a single point of entry for services, and these bots help when customers need fast and real-time responses. Many IVR and web service mechanisms can be transformed into a bot, and customer service experts can train the bots to perform redundant routine tasks. The data received from these interactions between humans and a bot are used to boost customer satisfaction and focus on ensuring that cracks are caught and flagged in time. 


Marketing is another action gear for the insurance sector that wishes to improve audience reach and secure higher customer acquisition. Being a part of the highly competitive market, insurers need to draw on a critical marketing strategy that goes beyond the traditional approach to cold calling. The old blanket methods are on the brink of extinction as the insurance field has already been shaken by digital disruption. Today's customers are looking for innovative, affordable, and highly personalized products with unique sales tactics. Using NLP and AI's combined strength in the insurance industry, insurers can gain access to clients' full profile. These data can be further analyzed to generate advanced insights and precise forecasts of consumer expectations for marketing activities.

The powerful combination of AI and ML helps insurers meet prospective customers, research on their real-time needs, gain insight on risk severity from their profile, and ultimately create tailor-made solutions. Although problems seem to dismay the current market, insurers still like to look optimistically at AI's potential in the insurance industry. It is exciting to see how innovations are cleverly disrupting the current traditional dynamics of the insurance system, making it more convenient, straightforward, and smarter for both businesses and consumers.   

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