How Artificial Intelligence Affects and Changes the Insurance Industry

There are plenty of startups out there working at the intersection of AI and insurance, and it essential to look at least at some of them to understand the future direction of the industry, as well as the kind of improvements AI is having in the insurtech space. An interesting thing to notice is that most of the innovation is happening in the UK rather than other countries, in all the segments proposed below.

Claim processing

Shift Technology skims the valid claims from the ones that deserve further validations; Tractable instead is trying to automatize experts task for insurances; ControlExpert has a specific focus on car claims;Cognotekt optimizes internal business processes, as well as Snapsheet does; Motionscloud offers instead mobile claim management solutions; and finallyRightIndem aims to help insurers to deliver on-premise smoothing the claiming flow.

Virtual Agents & Chatbots

Spixii is an automated insurance agent who helps you buying any insurance coverage you might want; Cognicor is a virtual assistant that offers customer care services; Conversica identifies which leads intend to purchase, while Your.MD is a personal health assistant that analyzes symptoms and produces pieces of advice. MedWhat instead uses EMR (medical records) to assist the patient as it was a virtual doctor, and Babylon gives medical advice taking care of tight budget constraints. Insurifyis another personal insurance agent who works as a comparator for car insurances.

What today is called simply chatbot is going to be renamed in a few years robo-insurer. There are already few examples of companies toward that goal: Risk Genius is indeed an intelligent comparator which identifies gaps in coverage for the customer and PolicyGenius looks for the best solution that fits customer’s needs and characteristics, while Drive Spotter implements real-time video analytics to keep drivers safe(r). More generally, robo-insurers will be a quite wide class of agents who will end up providing different services, all of them with the final goal of helping the clients to undertake risk-mitigating actions and only cover the real (residual) risks.

Customers engagement

Oscar is probably the most successful insurtech company out there, with the final goal of making insurance simple and accessible to everyone through a great UX. Similar to Oscar is somehow Stride Health, while Brolly is a tool that helps customers in understanding their own needs and facilitates in one place all the insurance coverages in place, in a similar fashion to Knip. Adtelligence instead creates personalized offers and relevant products based on customer’s characteristics. Captricity uses machine learning to convert handwritten files into structured data, and this can be used to better understand the final customer. Finally, ValChoice ranks the service of insurers to the benefit of the client.

Telematics

connected cars and telematics is a pretty big area itself (seeCBinsights article to know more about it), but it would be worthy to point out the work that Greenroad, Vnomics, and Telogis are doing in capturing driving behaviors and habits as well as computing fuel efficiency. Cambridge Mobile Telematics works similarly, although it uses smartphone data and mobile devices habits. Navdy is trying to revolutionizing the UI/UX within vehicles, displaying information in such a way that the driver does not get distracted.Lytx uses vision technology to provide real-time feedbacks to the driver.

Underwriting

AI can be (and actually is) used to spot out hidden correlations to granularly segment customers and risks in a more efficient way. Even though it might in theory possible to identify some algos that could perform better than others (see the work Wipro did for fraud detection), data always come first, at least for the next close future. Many companies operate in the space, as for instance Carpe Data that provides predictive algorithms and data products for property and casualty and life insurances through the analysis of public data (e.g., social media data). Atidot created a machine learning risk management platform, while Tyche uses unstructured data to optimize the underwriting and claims process. Big Cloud Analytics collects data from wearables and formulates health scores for a better risk assessment, while Cape Analytics uses computer vision techniques on geospatial data to improve the level of detail on current houses conditions. Dreamquark creates a more accurate representation of the medical datasets to be used for underwriting purposes by insurances, similarly to FitSense that offers also apps products. Melody Health Insurance provides also low-cost insurances, while Uvamo uses AI to assess the risk of policy applications. A more accurate underwriting can even translate into covering events that are today quite risky (e.g., as MeteoProtect and Praedicat, and are doing for weather risk management).

Finally, on a side, it is worthy to point out to pure technological enablers as Instanda, which offers a management tool to the insurance providers to manage effectively and timely new products launched; Insly, a cloud-based platform for insurance brokers; and finally, SimpleInsurance is instead an e-commerce provider for product insurances.

P2P insurance

Lemonade, Friendsurance, and Guevara are peer-to-peer insurance startups focusing respectively on property and casualty insurance the first two, and car insurance the latter one.

Insurchain & Smart Contracts

These are companies in the insurance sector that are driven by blockchain technology. Elliptic offers real-time AML for bitcoin specifically, while Everledger is a permanent immutable ledger for diamond certification. Luther Systems is instead a stealth-mode company working on the standardization of smart contracts. Dynamis provides a P2P supplementary unemployment insurance product, while Saldo.mx provides micro-insurance policies on the blockchain. SafeShare covers multiple parties with insurance cover at short notice and for varying periods, and finally, Teambrella is another P2P insurance platform run on the blockchain.

Insurance on-demand

This class of startups put in customers’ hand the entire insurance buying process. Trov is probably the best example of this new class of players and it allows to ensure things by simply taking a picture of them. Cuvva is quite similar but with a focus on car insurance, Sure and Airsurety on travel policies, and Back me up is another example of on-demand insurance. But this class does not include only the proper on-demand business model, but also insurance startups which provide products that vary by location, time, use, or customer. In other words, pay-per-mile business model (Metromile), micro-insurance policies (Neosurance), or eventually Insurance-as-a-service models (Digital Risks).

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