The (in)human touch: AI and fairness in insurance
People don’t trust insurers. We’ve probably all had to contact an insurer about a problem only to find it’s not covered in the small print. Rates are usually fixed, and sometimes unfair. There may also be hurdles in approving payment once a claim is made. Such factors can explain why a 2019 YouGov report found almost 70% of policy holders believed providers will do whatever they can to avoid paying out in the case of a legitimate claim. A 2018 TrustPilot report meanwhile found that insurance providers were the least trusted companies in the least trusted field, which was, perhaps unsurprisingly, financial services.
Insurance has a legitimate image problem. Luckily, artificial intelligence (AI) could be the gift consumers are waiting for. Startups around the globe are already stepping up to transform the insurance industry in the same way banking has been changed by fintech, using AI technology to automate everything from risk assessments to auto insurance. This automation is more advanced than that which generates an instant quote from an insurer, or a variety from price aggregators on assorted products. In fact, AI can help insurance products finally keep up with changing lifestyles and consumer demand,. As a theme itself, AI is impacting on sectors and businesses in an aggressive fashion, as noted by analytics firm GlobalData in their recent report on AI in insurance.