Everybody’s talking about ChatGPT, the AI powered chatbot created by OpenAI. AI has been on the technology agenda for a while, but for the first time, the wider world has taken notice. ChatGPT is currently the fastest growing app in the world, and has made machine learning technology accessible to those with no tech background, in a form that anybody can engage with and understand. This has stimulated a whole array of discussions about the implications of AI for numerous areas of life and business – including insurance.
In fact, insurance firms are already experimenting with ChatGPT. One notable example is Zurich, which recently announced it is trialing the technology in claims handling and modelling. No doubt numerous others are carrying out similar experiments behind the scenes, in a bid to gain a competitive advantage in a tough market. So, if you’re wondering how and where you might be able to put ChatGPT to work in your own insurance business or MGA, here are some of the key use-cases to think about:
- Customer service and sales: Customer service chatbots are nothing new, but as AI has become more intelligent, with the ability to absorb and analyse increasing amounts of information, it can now perform a valuable role in your customer service team. From answering simple policy questions, to providing quotes, or even responding to more personalised queries about cover or claims, it can act as a first port of call for customers. However, bear in mind that ChatGPT is only as useful as the data it has been trained on, so the key is supplying it with the right information at the outset, and then monitoring and optimising its outputs over time.
- Underwriting: ChatGPT has huge potential to assist underwriters, by helping them to understand and analyse risks, and reduce the administrative burden. For example, by inputting a selection of claims information, it can help to identify the biggest areas of risk for certain policies. It can also be used to gather and sift through external datasets, such as weather patterns, health or economic trends. While skilled underwriters will still be required to derive meaning from the information and put it into practice, ChatGPT has the potential to improve efficiency and accuracy of writing insurance cover.
- Claims: How insurance companies handle claims is critical, both to minimise fraud, maximise efficiency, and provide a positive customer experience. Using natural language processing, ChatGPT can assist with all these requirements. For example, it can automate claims applications by sifting through forms, extracting the relevant information, checking key details, and identifying potential red flags. It can also assist with customer support and streamline the claims settlement process.
Potential risks of using ChatGPT for insurance businesses
However, despite the opportunities provided by ChatGPT, it is still early days, and insurance businesses must be aware of the potential risks. While the technology is extremely intelligent, its responses can’t be relied upon 100%. It can and does make mistakes, so it is vital that outputs are checked by a trained professional before being used. Ultimately it is only as accurate and useful as the information that it has digested on a subject, so it can also result in biased outputs. It is up to companies to ensure that their data is as comprehensive as possible before relying on ChatGPT extensively.
Compliance is another major issue, and currently a grey area. The UK government recently released five ‘principles’ for using ChatGPT in business, but, as yet there are no clear controls or guidelines for insurance companies specifically. Privacy is understandably a big concern due to the volumes of data that need to be inputted into the system. For example, Italy banned the technology last month, citing GDPR concerns. It could also increase a company’s vulnerability to hackers, so it’s important to seek cyber security advice before integrating it into your systems.
Balancing hype and reality
ChatGPT is a new paradigm in the capabilities of AI and feels on a par with the creation of the internet for potential impact on the world. However, as with the early days of the web there will no doubt be a lot of hype, numerous false starts and plenty of mistakes being made along the way. So, insurance companies must be cautious when introducing it to their systems and processes, and particularly if exposing it to customer data.
Despite the futuristic scenarios, and concerns that it will replace humans completely, ChatGPT is still best looked at as an assistant, that can help skilled humans to do their jobs better, remove administration, and increasing efficiency. And the better your data and systems are currently working, the more helpful it can be.
If you’re yet to start your own digitisation journey, Insly can help you to automate the entire insurance lifecycle, with our no-code software. So, when you’re ready to harness the power of AI, you’ll be ready.
