Insurance


CONNECTED: Insurtech and IOT

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The "CONNECTED: Insurtech and IOT" event to be held in Milan on June 15th @ Microsoft House, will be centered around one of the most exciting topics of 2017: the evolution of the insurance world through new technologies like Artificial Intelligence, Social Networks, Augmented Reality and IoT. Gartner currently predicts some 8.4 billion connected things in 2017, to reach 20.4 billion Internet of Things (IoT) devices by 2020. The graph above by Venture Scanner highlights venture investing trends into the Internet of Things (IoT) sector, with data through April 2017. In the meantime Insurtech startups are creating new businesses in 14 categories with a total funding up to date of 18Billion according to Venture Scanner data, with $417 million raised between January and March 2017.


artificial-intelligence

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"Our experience working with insurers suggests that – by using machines instead of humans – insurers could cut their claims processing times down from a number of months to just a matter of minutes. But, when it comes to the advice and advocacy provided by an experienced broker, BizCover Managing Director Michael Gottlieb isn't convinced intermediaries are an endangered species. Suncorp's latest Insurance Insights white paper suggests that the automation of individual consumer products and small business packages is affecting the way that insurance professionals are recruited. However, BizCover's Michael Gottlieb approaches the human resource debate from a different angle, reflecting a more future-focused solution.


Artificial Intelligence: The new Kid in Town – Insurers.AI – Medium

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Apart from the likes of Google, Facebook, Amazon, and Tesla and their mainly digital business models and obvious applications of AI, a lot of traditional industries are employing intelligent algorithms to augment previously manual approaches. AI gives us means to automate processes, personalize products, communications and care, predict personal and collective developments, discover trends and unusual patterns in the data, and more. It has the potential to impact the insurance industry in numerous areas, such as marketing, customer interaction, claims processing, fraud detection, and underwriting. One use case for the application of AI lies in marketing and customer acquisition.


Sweet and Short Introduction to Complexity Science

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To analyze these clusters, changes in syndromes and consequently the core that remains fundamentally the same, complexity science applies network theory and analysis to explore the underlying structure. Hence, to organize behavior rules to set as base for agent based simulations, Common tools that complexity scientists use are extrapolating network trends from similar risks like extrapolating telematics network for drone insurance, game theory, genetic algorithms, heuristics and cognitive tendencies that we humans apply uncovered by behavioral finance, and neural networks. Agent based modeling combined individual decision and network rules to model policyholder behavior, allowing us to simulate behavior at an individual level and then analyze the overall, aggregate outcomes. The next post will follow a case study of agent based modeling to real life problem of underwriting cycles and highlight how Complexity Science adds value beyond traditional analyses.


Machine Learning and AI in Property and Casualty insurance

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In Property and Casualty Insurance, information is the currency that drives pricing, claim loss prediction and prevention, risk management and customer experience. Each year approximately 10% of AXA customers experience a loss. AXA used existing information such as customer demographics and historical claim data, local and regional data, and other external data with machine learning to identify those customers who were likely to experience a loss in excess of $10,000 so that they could price it appropriately. They began by identifying 70 risk factors; driver age, address, vehicle type, prior loss history, vehicle age, original purchase channel …etc.


The impact of AI on jobs is larger than you think

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In March this year, PWC released a report saying that 10 million UK jobs are at risk of being replaced by AI within 15 years. Insurance companies are already dinosaurs and while we will still need insurance, we don't need our current insurance companies. Those expensive on-site skilled jobs are gone forever, replaced by massive automation and AI from mining operations to plant operations to administration. Australia, as a home of the corporate oligopoly, suffers the associated elitism, complacency, lack of innovation and resistance to change which are characteristics of all oligopolies.


Brolly – An AI driven Insurance Advisory Application

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Brolly's vision is to re-design the insurance user experience based on data analytics and a centralised approach to the UI/UX of insurance policies Brolly is the UK's first artificially intelligent insurance advisory application that delivers contextually relevant insights through web and mobile apps which enables customers to make informed decisions about their insurance. With Brolly, customers can better understand whether they're over insured or under insured and where they can get a better price for the cover they need. The ultimate vision is to totally re-design the user experience of insurance based on data analytics and a centralised approach towards the UI/UX of insurance policies. Ultimately, Brolly is attempting to establish itself as an insurance hub for UK policy holders, thus enabling it to distribute insurance products directly as opposed to merely reporting the status of active policies.


The Transformation Of Insurance

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These firms come with a range of offerings - online comparisons, the mutual model (akin to the concept of a shared economy), peer to peer insurance, event or transaction specific cover (for example on demand car insurance or one time cover for sport), wearables and gamification to enhance customer engagement and drive better lifestyle choices, onboard devices in cars to reward safer driving, coverage of social risks (such as divorce or cancellation of a wedding), IoT based device linkages to provide real-time data, and, machine learning based process automation. Mobile apps are helping enhance customer engagement and providing specific insights to create real stickiness. Automated claims processing - leveraging Machine Learning and increasingly complex rules engines - is becoming more and more the standard. There is also a big change at the core of large insurance firms - in product development, risk assessment / management and underwriting.


Loan Underwriting Gets Artificial Intelligence Upgrade

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However, fintech startups are working to upend the traditional underwriting process with an injection of machine learning technology. Datanomers, a New Jersey-based fintech startup, has developed a "financial risk profiler" that trawls the web for unstructured non-financial data on loan applicants, indexes the information and generates a report for the underwriter. Datanomers' Risk Profiler collects billions of data points available on the web about small businesses to create a credit profile for borrowers. So rather than digging through pages upon pages of a small business owner's reviews via Yelp Inc (NYSE: YELP) and Angie's List Inc (NASDAQ: ANGI) for signs of unsound business practices, an underwriter can simply enter the proprietor's name into a Google (parent company, Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL))-like interface that will produce a PDF report of the prospective borrower's creditworthiness.


Loan Underwriting Gets Artificial Intelligence Upgrade

#artificialintelligence

However, fintech startups are working to upend the traditional underwriting process with an injection of machine learning technology. Datanomers, a New Jersey-based fintech startup, has developed a "financial risk profiler" that trawls the web for unstructured non-financial data on loan applicants, indexes the information and generates a report for the underwriter. Datanomers' Risk Profiler collects billions of data points available on the web about small businesses to create a credit profile for borrowers. So rather than digging through pages upon pages of a small business owner's reviews via Yelp Inc (NYSE: YELP) and Angie's List Inc (NASDAQ: ANGI) for signs of unsound business practices, an underwriter can simply enter the proprietor's name into a Google (parent company, Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL))-like interface that will produce a PDF report of the prospective borrower's creditworthiness.