A Little Less Conversation, a Little More Action in Insurance!

Towards the end of last year, I attended a major insurtech conference.

As ever, the week was packed with interesting debates and stories about how technology is impacting the insurance industry and how insurers are reacting to changing customer demands.

One of the key takeaways concerned the manner in which customers might soon be communicating with their insurer.

Talk becomes action

There has been a lot of chat (pun intended!) in the insurance industry about the future impact of chatbots. Now, it would seem, this talk is becoming a reality. Technology such as natural language processing has been advancing rapidly in recent months, as evidenced by the recent roll out of Google's Duplex technology to a select few Google Pixel phones. It seems the insurance industry is now ready to adopt this and other technologies for those customers who want it.

The value of talking

As far as insurance consumers are concerned chatbots offer two major benefits.

First and foremost, they allow the customer to manage their insurance and make claims as and when it suits them. People live busy lives and so providing customers with the option to manage their claim on their terms, when it suits them is a major boon.

The second benefit is expediency. Not only are you straight through to a chatbot, but the relevant information can be gathered quickly and easily in a logical manner. The simplicity of the language that chatbots must use, by dint of their "nature", also helps the customer as it avoids the regular complaint about the complexity of insurance terminology.

For insurers, the great benefit of customers using chat is that this frees up valuable human resources to be deployed where they are needed most. When it comes to sensitive claims, the ability to go beyond the algorithm and display empathy is fundamental to providing customers with the correct level of service. The more human resources an insurer can free up and dedicate to such claims, the better service they will be able to provide to their customers.

One bot doesn't fit all

Despite their evident advantages, it is still the case that there is a significant number of customers who approach chatbots with a degree of caution. As a fairly new technology, some are not yet convinced that chatbots are capable of doing what they need them to. At least that is a finding of a recent PwC report. Analysing digital voice assistant usage, the report showed that one in four consumers would not shop via their digital assistant, whilst 46 per cent did not trust the assistant to interpret correctly and process their order.

It is worth noting the issue may be less about fear of chatbots per se, but that people simply lack the confidence in their own ability to use these tools properly. In a Q&A session at the insurtech conference I attended this was widely discussed, with the insurers conscious of the need to avoid over-digitalisation as it could create a digital divide that leaves people behind.

The roll out of chatbots must also be balanced against security concerns. Digital assistants have been found to have some security flaws that that do need to be addressed. The social media platforms, on which chatbots are often hosted and run, face questions about privacy, especially in the fall out from Facebook's Cambridge Analytica episode. If chatbots are to become a more broadly used and viable tool, the need to demonstrate that sensitive information communicated over these channels is always protected is crucial. Not only that, the risk of falling foul of increasingly stringent data privacy laws such as GDPR, as Google did recently, is too great both reputationally and financially.

Becoming human

There are those who are concerned that the rise of chatbots, and machines in a wider sense, will supplant human workers, cutting out those that cannot participate in the new digital economy either through cost or the lack of appropriate skills.

As touched on already, we are seeing that as machines bear more of the load, humans are not replaced but redeployed to areas where they can provide more value. Chatbots that interact with internal staff and provide smart assistance around decision-making or automate routine processes, actually enrich the working experience.

This is something I have discussed at greater length already, but the importance of human interaction cannot be underestimated. This is especially important for insurers to remember in their customer service around claims. There is clearly a balance to be had between digitalisation and human empathy.

 

This article was originally published by Finextra