How AI Is Changing The Game In Insurance | 7wData

• Read original article here

The insurance industry is one of the largest in the world and has been around for hundreds of years, making it ripe for transformation by newcomers in the space. Over the past five to ten years, technology has pushed the frontier of what’s possible, making way for a new breed of digital-first insurance companies to come to life. The use of technology, data, artificial intelligence (AI), and modern design has created a powerful combination, changing what was once a very policy-centric industry to one that’s customer-centric.

I recently had the chance to speak to Daniel Schreiber, co-founder CEO of Lemonade, the digital insurance company powered by social impact with a mission dedicated to building the “most loveable insurance” available. During our conversation, he spoke about the company’s use of AI and big data, how it impacts the customer experience, and the opportunities (and, at times, challenges) it brings to the industry.

Gary Drenik: Can you share more on how Lemonade is using AI?

Daniel Schreiber: We describe Lemonade as being built on behavioral economics and artificial intelligence, which has been true since Lemonade was founded. As a new company looking to disrupt what’s been the go-to model for a centuries-old industry, we wanted to harness the power of AI and big data to not only power our own product but encourage the industry to do the same. In an ideal world, this would lead to insurance becoming fairer, cheaper, and faster. No two people are entirely alike; different people should be treated differently—this should be reflected in how insurance assesses risk and prices policies in a world of individuals.

At Lemonade, AI is deeply integrated into our product and also internal processes. Interactions with our customers across our platform generate a trove of data, which in turn improves future interactions. This includes interactions with our chatbots AI Maya, a playful onboarding and customer experience bot, and AI Jim, our claims bot that handles the “first notice of loss” (and many times can manage a claim start to finish). Internally, AI deeply impacts our approach to our book of business through advanced Machine Learning models, like our recent LTV6 model, and Lemonade’s forensic graph, which utilizes AI combined with the power of behavioral economics and big data to predict, deter, detect, and block fraud throughout the customer engagement.

Drenik: Can you dive into more about how this impacts the customer experience?

Schreiber: When Lemonade was founded six years ago, part of our mission was to digitize insurance end-to-end, leveraging technology, data, and artificial intelligence to create a more delightful, affordable, and precise approach. We wanted to build a product that would appeal to the next generation of consumers, which meant easy-to-use, personalized, and efficient service when and where they needed it.

A two-minute chat with our bot, AI Maya, is all it takes to get a personalized quote, sign up for a policy, and facilitate payments. AI Jim is our claims bot that handles the “first notice of loss” for almost all Lemonade claims and can manage an entire claim through resolution without any human involvement for almost half of all claims. This breezy experience from start to finish is a core part of what makes Lemonade unique—giving customers a seamless, delightful experience.

Today, a majority of our customers are under the age of 35—according to a recent Prosper Insights & Analytics Survey, more than 30% of this general age range (Gen-Z and Millennials) are looking to move in the next six months. Whether that’s renting their first apartment or buying a home, this opens up Lemonade to two separate opportunities with both Renters and Homeowners insurance, and our use of AI makes it possible for either audience to get a quote and obtain a policy in a matter of minutes.