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Today’s customers are more willing to share their sensitive data in exchange for a quick and personalised customer journey, but the insurance industry is struggling to keep up with the AI trends.

How to best leverage AI tools but at the same time make sure the customers feel comfortable sharing their sensitive data?

Technology is providing a key role in the insurance industry’s progression, especially since the start of COVID-19. Today’s customers are increasingly willingly to share personal data in exchange for a personalised experience and lower premiums. AI and machine learning significantly improve the customer experience. Previously customers were faced with numerous, intrusive questions which were often repeated throughout the underwriting interview. This regularly deterred consumers from following through with purchasing life insurance. AI provides insurers with a deeper understanding of customer data and allows them to make better-informed decisions. Fewer decisions need to be made manually by underwriters, which improves and quickens the overall experience for the end customer. These quicker and more informed decisions allow for lower premiums.

Customers should be assured that all data provided is protected under GDPR and is not shared with anyone unnecessarily.

What are the new customer expectations specific to an insurance industry?

The insurance industry often lags behind other industries in terms of keeping up with new technological trends. It is by nature, a very risk-adverse industry. As a result the underwriting interview and customer journey when purchasing life insurance can feel laboured and slow to the average customer. Younger customers now expect a quick, seamless digital experience. They do not want to meet with brokers and insurers face-to-face and answer many different questions over multiple sessions. Insurers now need to ensure that the process is streamlined to catch most of the underwriting information in one session. Similarly, when there is a need for third-party data, customers are hesitant to go for in-person testing and analysis. They now expect third-party data to be integrated within the underwriting interview and to provide results instantaneously. This is especially the case in the US where medical history is much more accessible.

How can companies turn data into an opportunity to grow and improve customer journey?

Using analytical tools (such as ALLFINANZ Insight) allows insurers to analyse multiple responses to the underwriting interview on a case by case basis. Rules can be changed to remove as much free text as possible from the underwriting interview, by using reflexive questions instead to improve the customer journey. Insurers can analyse each individual rule by length of time it takes to answer, STP rate, customer profile, etc. These insights allow insurers to alter rules to increase STP rates and the overall customer experience.

Data is also used to regularly train predicative models, allowing AI to quickly determine which data points are irrelevant. Analysing past data provides insurers with augmented automated underwriting and as a result, higher STP rates.

Paul will also be joining our 12th Annual Customer Experience Management Summit this October, where he will go into details of the usage of data in his presentation Deploying AI in a Tightly-Regulated Environment: Lessons from the Life Insurance Industry.

Paul Donnelly has over 25 years of experience in engineering, product management, marketing, sales and operations. As Munich Re Automation Solutions’ Executive Vice President for EMEA, he is responsible for managing all aspects of the business operations, growth and profitability throughout the EMEA region. Paul is personally engaged with a number of Munich Re’s EMEA customers and focuses his whole organisation on the primary goal of continually delivering value to customers, helping them achieve their goals and revolutionise their business. Previously, Paul worked as Director of Product Management and helped introduce new products through leveraging and extending Munich Re Automation Solutions existing market-leading platform. Prior to moving into the InsurTech sector in 2009, Paul has helped build a start-up venture from the ground up, steered companies through growth and complex change, chaired the board of a €400m annual turnover organisation with 4,500 employees. Paul is currently the chairman of St James Hospital in Dublin and has served on boards in both the health and commercial spheres including the Coombe Women & Infants University Hospital, the Clanwilliam Institute and Personally Speaking Bureau Ltd.

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