Research rolled out by the professional IT services company Accenture suggests that the entire global insurance industry is losing up to $170 billion in lost premiums due to poor claims insurance and inefficient underwriting processes. But it also establishes that the combination of machine learning, Artificial Intelligence (AI), and data analytics could be key to addressing the problem.
The study titled “Transforming claims and underwriting with AI” involved 6700 policyholders from across 25 nations; more than 900 underwriters within the U.S.; as well as more than 120 claims executives across 12 countries. Per the study, it sought to identify emerging challenges posed to the international insurance industry and how future computer technologies could play a significant role in influencing them.
Boiling down to claimants’ dissatisfaction, 31 percent claims they were unhappy with how their insurance handled their home and car insurance claims in the last two years. 60 percent of the 31 percent raised an issue with the speed of the settlement whereas a greater 45 percent had concerns over the nature of the settlement.
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A third of the unhappy claimants have made a switch on their insurance companies in the past two years while 47 percent say they are considering it.
Loss in premiums is commonplace in the industry, with it typically losing $34 billion per year. However, the study reveals that this could balloon to up to $170 billion in five years, though it is said could be resolved with AI which could cut underwriting operational costs that are otherwise taking a large part of the expense.