Artificial intelligence is no longer alien to insurance professionals.
For several years, discussions revolving around AI and its potential consequences on the insurance sector have taken center stage.
Often, these conversations were shrouded under another term with which we are significantly familiar — big data.
Big data has been integral to insurance discussions for decades, mainly due to the vast amounts of data the industry generates and deals with daily.
From actuarial tables to health and lifestyle information, the insurance industry is brimming with data.
As such, it is not surprising that the life insurance settlement industry is taking an extremely close look at the AI revolution.
How Artificial Intelligence Is Created and Utilized
At its core, AI is developed by meticulously analyzing large amounts of data and behavioral patterns.
Its intelligent decisions are data-driven, bridging the gap between raw data and actionable insights.
The emergence of GPT, a writing AI program, has further emphasized the power and potential of AI, turning previously complex processes into more straightforward tasks.
AI is harnessed to undertake tasks that are either too challenging, repetitive or costly for human intervention.
AI is expected to vastly affect various aspects of the insurance industry, including risk assessment, fraud detection, human error reduction, claim processing and customer service enhancement.
All of these areas, currently handled by humans and computers, are ripe for evolution through AI.
The Potential of AI in Insurance
AI's transformative potential extends to altering how insurance is underwritten, priced and sold.
With AI, even more data will become available over time, and it will be able to conduct research and gather information at a rate that outpaces human capabilities.
Consider a real-life scenario:
An individual seeking a life insurance policy enjoys skydiving but is aware that acknowledging this hobby on their application might lead to either denial of the policy or an exorbitantly high premium.
Consequently, the individual denies having this hobby.
An AI program, however, could analyze the applicant's social media feeds and discover evidence of their skydiving activities.
While this is currently not practical for humans due to time constraints, AI could efficiently perform this task.
AI could improve life insurance settlement by providing more accurate life expectancy data.
