Chatbots carry new opportunities for insurers, agents
Chatbots are all the rage these days, and the insurance industry is no exception. But chatbot accuracy still needs work.
A growing number of insurers and agents now use chatbots to facilitate conversations with customers, strengthen relationships and bolster the sales process.
But major hurdles remain.
Chatbots Magazine describes a chatbot as a computer program that conducts a conversation in natural language via auditory or textual methods, understands the intent of the user, and sends a response based on the business rules and data of the organization.
Another way to describe chatbot programming is the concept of “micro-engagement,” or technology designed to communicate with customers and prospects at various intervals and via multiple channels in order to drive business interactions.
Whatever the digital nomenclature, it’s important for boards of directors and C-level executives within the insurance industry to understand that chatbots are an increasingly effective way to improve business processes — but are not a panacea.
Roughly 65% of customer interaction can now be automated, according to proprietary research conducted by Ushur. In order to maximize their effectiveness, chatbots must be wed to a comprehensive communications process that also includes humans (who can step in at the appropriate time). Being able to extract information from an insurance claim is a fairly complex task that demands a human component.
With that in mind, here are ways chatbots are altering the insurance industry.
No. 1: Better the customer journey.
Through call centers and websites, chatbots are able to respond to customer inquiries in real time — without the need for agents — and point customers in the appropriate direction. For example, bots can provide a quote for a specific type of insurance coverage or automate the entire Eligibility of Insurance (EOI) process. The goal is to ensure that all the data accumulated by chatbots is seamlessly delivered to the back office where human representatives can pick things up accordingly. With chatbots in the mix, what used to take several days for insurers to process is now reduced to a mere few minutes (at least on paper).
No. 2: Automated insurance claims more efficiently.
Chatbots play a growing role in the sales enablement process in terms of their ability to actuate and automate broker engagement and insurance-policy underwriting. One of the biggest challenges for chatbots moving forward is how they work alongside legacy insurance platforms (which, in some cases, have been around for ten or 15 years).
Chatbots only take the process so far; they deliver a limited amount of information regarding customer inquiries. The secret sauce for automating claims is tying the information that’s been accumulated by chatbots with workflow automation. In our experience, companies that have deployed workflow automation have been able to completely eliminate certain use cases conducted primarily over the phone in contact centers. Insurers need to get busy in this area and develop pilot programs and proofs of concept.
No. 3: Easier transition to digital-first business model.
To maximize chatbots and digital communications, insurers first need to take the work that agents conduct on a daily basis — calling customers and prospects, sending emails and faxes — and build an effective outbound bot interface to automate those workflows. This will drive customers conversations for a variety of insurance services provided by agents, such as data gathering, claim status, failed payments, and product renewals. Augmenting even 35% to 40% of an individual agent’s productivity can make a significant difference for the insurance company.
Texting as an interface, messaging as an interface, that’s where things are moving. Under this scenario, it’s not a synchronistic traction in which there is immediate give-and-take between customer and insurer. It’s an asynchronistic traction, meaning insurers can send a text message and customers can choose when to respond, whether it’s five seconds or five weeks, and complete the entire interaction. That requires a very different type of solution compared to how insurers have communicated with their customers traditionally.
One of the key elements of leveraging chatbots successfully is an underlying AI component. When you have an AI component that’s only 70% to 80% accurate, it could be problematic for the end user. For instance, think of how frustrating it would be for a non-native English speaker in a foreign city trying to get information from Siri and Siri says repeatedly, “I didn’t understand the question.”
Such frustration also applies for consumers who are simply trying to get an insurance quote. To make the chatbot experience more effective and hassle-free for consumers, insurers must strive to bring chatbot accuracy levels up to 90% and above.
However, due to the ongoing interactions between startup technology companies and the insurance industry, the quality of AI and machine learning data centers continues to improve. That opens the door for more chatbot-based solutions, frictionless sales and more satisfied customers and prospects.
Simha Sadasiva is the co-founder & CEO at Ushur, a micro-engagement service platform that leverages data and technology to digitally transform backend processes and conversational interfaces for enterprises in the insurance sector. To find out more, send email to info@ushur.com.
These opinions are the author’s own.
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