--AI can help brokers improve efficiency, customer service and risk management, creating a competitive advantage.
Artificial intelligence is well on its way to becoming the number one game-changer in insurance. The key will be learning how to use it to maximize efficiency and assist with time-consuming tasks to free industry experts to focus on the areas where they can make the biggest impact—building meaningful client relationships and providing personalized service to exceed the expectations of their clients.
According to McKinsey, “AI and its related technologies will have a seismic impact on all aspects of the insurance industry.” With the rapid pace of technological change, some insurance brokerage firms will inevitably find it difficult to keep up. They will lose ground to competitors that embrace it.
Some insurance brokers may be concerned that technology will replace them due to the increasing use of AI in underwriting, claims management and customer service. Instead, they should realize how they can use AI to support their growth. Focusing on what it means to be a broker and which activities can only be done by humans is essential, as is understanding how AI-powered tools can absolve them from the mundane, repetitive tasks that take them away from what they should focus on.
Commercial brokers' responsibilities extend beyond transactional duties. They have industry knowledge and the ability to establish trustworthy relationships. AI will not be able to replicate their strategic thinking, negotiating abilities and unique approach, making them essential for navigating complex business transactions.
A valuable partner
AI provides commercial insurance brokers with data-driven insights, streamlines operational processes and helps automate mundane tasks. By adopting such tools and digital platforms, brokers can obtain a competitive advantage, enhance their efficiency and customer service and mitigate their E&O risk. In a nutshell, technology can help brokers thrive in an industry that is rapidly transforming.
See also: Why AI-Assisted Selling Is the Future
Improved Customer Experience
The most effective use of AI in insurance companies, according to a 2021 PwC survey, is in delivering a more positive customer experience. AI enables brokers to provide faster and more accurate responses to customer inquiries. Additionally, AI-powered analytics help brokers understand their clients' needs and preferences, allowing them to tailor their services accordingly.
Better Risk Management
AI also helps brokers better assess and manage risks. AI can analyze vast amounts of data and identify patterns and trends that humans are not able to see, allowing brokers to make more informed decisions. Additionally, AI helps brokers identify potential fraud and other risks, so they can take steps to avoid them.
Ultimately, by embracing AI, brokers gain a competitive advantage over peers that are slow to adopt the technology. Customers expect highly personalized experiences, and brokers that are tech-savvy can deliver on those expectations faster and more easily and are better-positioned to attract and retain clients.
According to one Deloitte study, only 1.3% of insurance companies are investing in AI. But according to Next Move Strategy Consulting, AI use is expected to grow twentyfold by 2030.
Fifty-two percent of companies accelerated their AI adoption plans because of the COVID crisis, a study by PwC found. Nearly 86% said AI was becoming a “mainstream technology” at their company.
See also: Technology and the Agent of the Future
It is the era of digital transformation in insurance. With AI moving full steam ahead, insurance brokers can realize real value from its adoption. They should not shy away but rather embrace it as a tool to improve efficiency, customer service and risk management, creating competitive advantage.
Fear of the unknown is human nature—but there’s no need for fear. Early adopters have a lot to gain, whereas laggards may find it tough to catch up. So, while AI may change the role of brokers in the insurance industry, it will not replace them. Rather, it will allow brokers to focus on higher-value tasks, provide better service to their clients, and build more business than they ever thought imaginable.