The growing use of NLP chatbots in insurance

With the hyper-accelerated growth of digitization that arrived in the wake of the pandemic, consumer expectations have also changed radically. Countless industries are now forced to rethink the way they present themselves and their products.

The insurance industry is no exception.

In the insurance sector, sales and customer success teams are feeling the pressure to deliver user experiences that are faster and more intuitive than ever. Even for processes as mundane as quoting, policymaking and activation, customers now expect transactions to be much simpler from end-to-end.

With rising premium costs and the often-lengthy wait times to speak with insurance brokers, many carriers have turned to Natural Language Processing (NLP) chatbots to meet growing communication demands and heightened consumer expectations for prompt service. There are good reasons this trend is taking hold: Thanks to chatbots powered by advanced tech such as artificial intelligence (AI), machine learning (ML) and NLP, insurers across the industry will see a staggering $1.3 billion in savings by 2023 due to increased efficiency, up from $300 million from 2019.

What are NLP chatbots/?

NLP is a Deep Learning function that enables computer programs to derive meaning from user inputs. In the context of chatbots, NLP can assess the intent of user queries and use context clues to create a response similar to that of a human being.

In other words, NLP chatbots give a personalized touch to digital customer interactions without the need for additional customer service and IT hires. But these chatbots don’t have an innate ability to understand human speech and must be trained to accurately react to inputs — a process that requires considerable time, work, sophisticated technology and data. Though they do therefore require strategic investment, AI- and ML- powered NLP chatbots have a clear advantage in their ability to learn and improve through each user interaction, improving accuracy and effectiveness over time.

Why use NLP chatbots

Today, consumers expect a fully personalized experience along the entirety of their insurance customer journey. Touchpoints such as benefit offerings, marketing messages, price quoting, policy recommendations and more must be incorporated seamlessly. Not only can NPL-powered virtual assistants or chatbots help deliver this level of personalization, but 77% of consumers report that chatbots will actually change their impression of companies over the coming five years, due to the speed and ease with which chatbots allow them to communicate with a brand.

The ability to support automated user interactions does more than provide customers with helpful solutions in a timely manner; it stands to increase efficiency for insurance agents who have difficulty answering each and every customer query. And beyond customer service, NLP-powered chatbots can assist in such processes as claims management, which is time-consuming, costly and subject to human error.

By integrating and facilitating solutions like NLP chatbots, customer-facing processes can be sped up substantially with little to no extra manpower. When chatbots can process and analyze speech and text faster their human counterparts, all that remains is for a human to verify the results.

How to use NLP chatbots

So, what are the practical implementations of these beneficial tools? Here are some use cases based around a standard customer journey through the insurance value chain.

Answering FAQs: ML-powered NLP chatbots can decipher basic user interactions to understand what customers are asking. This can provide a positive first interaction without the customer needlessly waiting for an agent and increase conversions by engaging with every visitor on multiple channels in a way that reflects their personal needs

Generate quotes and sell services: For customers ready to invest in an insurance policy, an insurance chatbot can simplify the finalization process by offering:

• Insurance plans in understandable, jargon-free terms;
• Step-by-step forms with detailed instructions;
• Personalized policy recommendations; and
• Immediate, tailored quotes.

Receive claims and update policy holders: In the time a customer might be stuck on hold for an in-person interaction, a chatbot could have already collected and processed the relevant data — everything from necessary documents to supporting images or videos. This can help detect claim inconsistencies and fraudulent details without the need for in person meetings, as well as speed up average handling times and increase first contact resolution — ultimately reducing pressure on customer service teams

Provide account information: NLP chatbots let policyholders easily and instantly manage their accounts and access customer support across multiple channels at any time, allowing insurers to:

• Provide consistent, accurate information;
• Shrink workloads for support agents so they can concentrate on more complicated, higher-value responsibilities; and
• Reduce staff turnover by boosting employee job satisfaction and productivity.

Enable easy customer feedback: Chatbots make it simpler for users to submit helpful feedback regarding insurance offerings and customer service. This allows insurers to aggregate useful analytics regarding chatbot performance and make ongoing improvements to the entire customer journey.

Customers don’t necessarily select their carriers based on chatbot capabilities, but the growing pervasion of digital insurance continues to change expectations, and the transition from low-touch to consistent contact will rise accordingly.

The key to this success is, just do it! Find a chatbot process that compliments your available resources and fits your criteria to support new growth opportunities. Insurers who embrace

automation in the realm of customer support will thrive in the age of digital insurance.

Colleen Wells (colleen.wells@sapiens.com) is vice president of Global Digital Product Strategy at Sapiens. Any opinions expressed here are the author’s own.

Also by this contributor:

• The upside of niche product offerings in insurance
• How insurers can successfully achieve true digital transformation