Enhance customer services
AI applications, particularly Gen AI, are expected to generate substantial savings for the insurance industry by automating customer services for a more digital, seamless, and undisrupted experience. BCG estimates the largest savings generated from Gen AI applications to come from productivity gains in customer services, accounting for as much as 60% of the cost saved [3]. AI allows insurers to improve operations and save costs by enabling customer self-service, which previously required agents’ attention, including dealing with customer inquiries and receiving claim requests. The emergence of AI-powered customer super apps has significantly streamlined customer service processes while simultaneously elevating user experience. For instance, AI-powered chatbots integrated in super apps allow customers to retrieve data effortlessly and 24/7 without contacting human agents. This feature not only helps free up agent capacity but also speeds up customer inquiries processing, which in turn leads to higher customer satisfaction. Indeed, a world-leading insurance group headquartered in Asia has partnered with FPT Software to implement an AI-powered super app, successfully digitalizing 96% of their customer services and having a whopping 87% of customer inquiries resolved in the first call.
Boost agent productivity & improve sales performance
The insurance industry requires agents to understand and provide customers with accurate information about a great deal of products. Collecting such information is time-consuming, with BCG revealing that as much as 35% of agents’ time is spent on gathering information on policies, terms, and other related documents. Nevertheless, AI emerges as a powerful solution as the consulting firm estimates GenAI application to double agents’ productivity for said data retrieving tasks [4]. That’s because GenAI chatbots can summarize documents, pinpoint answers, and provide concise explanations, all in a matter of seconds, saving agents from hours of going through the policies. Global insurers have begun experimenting with the solution, including a leading life insurer that utilized the AI-Agent Digital Platform (AIDP) solution by FPT Software. The AI chatbot integrated in the AIDP solution not only helps the company’s agents to accelerate data retrieving but also provides suggestions on lead management and follow-up actions to win prospects, as well as generating digital scripts for approaching leads. These features help the company’s agents improve performance and subsequently close deals more efficiently, thus increasing their distribution to sales growth to more than 28% and raising the number of MDRT to 25% after one year of AIDP adoption.
AI is also expected to assist decision-making and guide strategies by providing data-driven evidence. Lapse predictions, the process of forecasting high-risk policyholders that potentially terminate contracts on the next due date, is one prominent use case of AI in insurance. The application is readily available on the market, with FPT Software’s Confidon being one of the highly recognized solutions. Confidon allows insurers to perform lapse predictions based on input data such as policy attributes, payment history, and customer behaviors. It will then leverage AI to compare the major differences between the high and low-risk groups, calculate lapse scores, and identify high-risk policyholders. With lapse prediction, Confidon helps insurers identify proactive measures and redirect sales strategies to retain customers before they terminate contracts. Coupled with other features for underwriting and claim processing automation, Confidon has received global awards, including the Gold Globee Winner, IT Solutions for Insurance, 2024.
Streamline underwriting and claim processing
Despite its significance, underwriting and claim processing are often time-consuming and labor-intensive, leading to delayed decision-making. Such prolonged processing can make or break an insurer, affecting both employee productivity and customer satisfaction. Research reveals that underwriters spend as much as 40% of their time on non-core activities, accumulating to an efficiency loss of up to $160 million in the next five years. In addition, lowered customer satisfaction with the claim process is one major driver for switching carriers, leaving $170 million in premiums at risk by 2027 [5]. Undoubtedly, insurers now face a pressing need to implement underwriting and claim processing automation, with some major players already leading the race.
For instance, a giant finance group in Asia-Pacific has leveraged FPT Software’s Confidon solution to augment underwriting and claim processing. When customers submit policies and claim requests with the required documents, integrated OCR technology will automatically scan the documents and fill in the applications while requesters simply review and sign off. Once submitted, unable to pass the existing rule-based engine, Confidon assesses the policies and claim requests by leveraging AI to calculate risk-based scores and compare them with pre-defined thresholds. Policies and claims marked as low risks are automatically issued and paid out with instant notifications sent to the requesters, while high-risk applications are subject to further examination by the company’s employees. As a result, Confidon helps the finance group increase the Straight-Through-Processing rate in claim processing to 55%, equivalent to 140,000 requests annually. More than that, the solution significantly speeds up the process, reducing the claim handling time from 2 days to merely 2 minutes, from submission to payment. The company also improves fraud detection thanks to Confidon’s AI assessment feature, saving 8% of the total value of claim cases by identifying fraudulent requests.
Unlock the AI power with caution
Despite its profound potential, implementing AI does come with challenges regarding ethics, privacy, and data transparency as insurers deal with sensitive and confidential information such as medical records. Such concerns have caused global insurers to proceed with caution, with 52% of surveyed CEOs viewing ethical challenges as the biggest obstacle to AI implementation [6]. Navigating this situation is not an easy task, especially when AI regulations and guidelines are changing constantly on a daily basis. Nevertheless, overlooking AI applications can hurt insurers’ competitiveness and leave their operations at risk. One solution is to seek consultation from highly experienced technology providers with in-depth insurance expertise who actively engage in responsible AI development, such as FPT Software. With 20+ years of experience, the company has served over 70 BFSI organizations, including leading insurers such as AIA, Prudential, and Manulife. The company has played an active role in promoting responsible AI, fostering collaboration with Landing AI, Mila, and members within the AI Alliance to develop guidelines and best practices for the subject.
Learn more about FPT Software at: https://fptsoftware.com/industries/bfsi
