Valuable insights from Daniel Shreiber CEO of Lemonade on the competitive advantage and profitability impact of effectively segmenting customers by applying AI. Shows the critical success factor required by every insurer- master data management resources and choosing the optimal AI toolset.
Read the full article (link at bottom of article) but for now I take another key lesson that insurers must find ways to access all the data stored in multiple silos inherited over years of M&A. The fact is- typically 80% is inaccessible and worse still much of the data is of an unstructured format. Even if you surface the data most of it is hidden from analysis.
It's like trying to drive through Europe with a car Sat Nav that only has a map of the UK loaded. You get lost or rely on manual maps and signs. Your decision making is limited and even faulty.
That is why 360Globalnet built 360Retrieve which makes 100% of an insurer's data analysable. It takes raw, unstructured data and makes it "AI Ready". Take motor claims. Our insurance customers have been able to surface and normalise 7 years of claims data including data hidden in emails, letters, reports, investigations and the freeform fields in claims notification forms (CNFs).
There is a whole industry revolving around professional fraudsters and the tangled webs of legal companies, scapyards, 2nd-hand car dealers, welders and dodgy claimants.
It takes a combination of human intuition and technology to uncover these. Fraud specialists who can see into the minds of those who would seek to explóit an insurer's vulnerabilities. They change their modus operandi to say ahead of the game.
If you don’t have the data you don’t have the model and AI is still woefully short of all the data it needs to detect fraud, hence the high 25% white noise which is not untypical.
Think of the drama of crime investigations and police files. Criminal investigations gather masses of evidence as they try to separate truth from fiction by identifying inconsistencies in the information they retrieve. In fact, Thames Valley Police, Lancashire Constabulary and The Crown Office and Procurator Fiscal Service (COPFS) all used our document management system, 360Retrieve, to locate evidence and unused material amongst several million pages of documents.
The process of unlocking this maze of unstructured data is called "Entity Extraction" . 360Retrieve unlocks your ability to access 100% of your data, improve your decision making and increase fraud detection, evidence profile and GDPR compliance with Subject Access Request (SAR). It provides sophisticated operational business and management information without the need for technical knowledge and without disrupting your existing systems. This is how to search multiple scanned documents at once.
360Retrieve lets you progress through stages two and three Schreiber explains as vital to be a top quintile insurer. You now have the model and 100% of the data to leverage AI.
And frankly, of you don't do that others will. Lemonade is a shining example in renter's insurance and claims. The data giants from Amazon and Google to Ping An and Tencent are world leaders. All are targeting your space in one way or another.
Carriers and reinsurers can do the same today to unlock the hidden insights that will enable better decision making today.
Find out more and progress through the steps Daniel Schreiber describes by sending me an email with the issues you need to address.
Mike.Daly@360Globalnet.com
PS- in case you haven't figured it out I do work at 360Globalnet and so must confess a bias even if your best interests are at heart.
What intelligence and data have done for humanity throughout our history, artificial intelligence and big data can start to do for the insurance industry. This is not only increasingly possible as a matter of technology, it is also desirable as a matter of policy. Furthermore, as the change will represent a huge competitive advantage, it is also largely inevitable. Those who fail to embrace the precision underwriting and pricing of Phase 3 will ultimately be adversely selected out of business. Insurance is the business of assessing risks, and pricing policies to match. As no two people are entirely alike, that means treating different people differently. For the first time in history, we’re on the cusp of being able to do precisely that.
http://insurancethoughtleadership.com/how-ai-can-vanquish-bias/
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