By Will Murphy, Vice President, Technology Alliances
The P&C insurance industry is undergoing a significant transformation in claims processing, driven by artificial intelligence (AI) and insurtech innovations that streamline operations, enhance accuracy, and improve customer experiences.
With increasing claims volumes, rising fraud risks, and evolving customer expectations, insurers are embracing AI-powered technologies to adapt and remain competitive.
Why Insurers Are Turning to AI for Claims Management
The need for AI in claims processing arises from several key challenges:
- Claims Backlogs and Adjuster Shortages: The industry is struggling with staffing shortages and increasing claims complexity, leading to delays in resolution.
- Operational Costs and Efficiency Demands: The lack of full automation for straight-through processing (STP) increases operational costs and leaves insurers more vulnerable to human error.
- Fraud Detection and Prevention: Insurance fraud costs the industry billions annually, with the FBI estimating fraud-related losses at more than $40 billion per year.
- Customer Expectations for Speed and Transparency: Policyholders now expect faster claims resolution enabled by digital-first experiences, especially in the mobile age. According to data from J.D. Power, satisfied customers who find the claims process easy are twice as likely to renew their policy.
AI and insurtech solutions address these challenges head-on by minimizing processing disruptions, reducing costs, and mitigating fraud.
How AI Improves Claims Processing
AI is revolutionizing claims processing by expediting First Notice of Loss (FNOL) and claim triage. AI-driven tools can now automate FNOL intake, instantly assessing claim complexity, severity, and urgency. This ensures that simple claims are processed automatically while more complex cases are swiftly assigned to the right adjusters, significantly reducing delays.
Beyond speeding up intake, AI is also enhancing fraud detection. Machine learning models analyze historical claims data, identifying suspicious patterns and anomalies that might indicate fraud. By flagging potential fraudulent claims in real-time, insurers can prevent unnecessary payouts and minimize loss ratios, ultimately improving financial performance.
AI further improves efficiency by reducing adjuster workloads and accelerating settlement. By leveraging natural language processing (NLP) and image recognition, AI can pre-fill claim details, validate documentation, and even assess property or vehicle damage. These capabilities enable insurers to move from lengthy, manual evaluations to faster, more accurate claim resolutions.
In addition to speed and accuracy, AI is also lowering operational costs. Automating repetitive, labor-intensive tasks allows insurers to optimize human resources, focusing skilled adjusters on complex claims rather than administrative work. This reduces overhead expenses and improves the overall efficiency of claims operations.
By integrating AI-driven solutions, insurers are transforming claims processing into a faster, smarter, and more cost-effective operation—enhancing customer satisfaction with real-time updates and allowing adjusters to focus on more complex cases, ultimately improving bottom-line results.
How to Harness AI to Streamline Claims and Combat Fraud
The Guidewire Marketplace features a diverse selection of trusted partner integrations to help improve claims management.
Shift Technology delivers AI-powered fraud detection and claims automation that significantly outperforms traditional methods. Its solution stands out by delivering a threefold increase in fraud detection hit rates compared to manual or rules-based approaches. It analyzes claims data in real time or through scheduled workflows, identifying fraudulent activity with high precision. Shift also provides transparent decision-making—each flagged claim includes a detailed rationale, enabling investigators to act swiftly and confidently while reducing false positives and accelerating fraud investigations.
Another key player, FRISS, specializes in AI-powered fraud detection and risk assessment solutions that integrate directly into the Guidewire ClaimCenter workflow. Its real-time fraud detection capabilities are applied throughout the claims lifecycle, automatically flagging suspicious activity using advanced AI, network analytics, and both internal and external data sources. FRISS delivers dynamic risk scores and actionable insights directly to adjusters, enabling faster, more informed decisions.
CLARA Analytics provides the CLARAty.ai platform, which delivers AI-driven insights directly within Guidewire ClaimCenter to support real-time decision-making. Its unique differentiator lies in its Triage and Treatment alerts, which help adjusters identify potential issues early—such as reserve mismatches and litigation risks—before they escalate. This proactive guidance allows insurers to manage claims more strategically and improve resolution timelines.
EvolutionIQ brings a specialized focus to complex claims handling through its AI-powered Claims Guidance platform, which is also integrated with Guidewire ClaimCenter. What sets EvolutionIQ apart is its ability to analyze both structured and unstructured data—including adjuster notes and medical documentation—to identify high-impact, complex claims. By surfacing these cases and recommending targeted interventions, it enables adjusters to focus on the claims that matter most, improving outcomes and accelerating return-to-work scenarios.
Expanding Your AI and Claims Toolkit
Beyond the leading AI-powered solutions covered above, a new generation of insurtech innovators is emerging to enhance every stage of the claims lifecycle—from telematics, intake and triage to investigation, valuation, and resolution. Among the most impactful are our Guidewire Insurtech Vanguards:
Faura brings powerful AI-driven document processing to the forefront of claims operations. Its solution automates the extraction and validation of data from incoming documents, reducing manual entry and ensuring more accurate claim records right from the start. Viper focuses on the intake stage, using intelligent data capture to automate claims routing. Its ability to quickly interpret and assign incoming claims reduces bottlenecks and ensures adjusters receive the right cases at the right time.
Xtract stands out in auto claims, where it uses telematics data and imagery to digitally reconstruct accidents. This accelerates decision-making by giving adjusters an immediate and clear view of liability and severity—enhancing both customer satisfaction and operational efficiency. hyperexponential contributes on the analytics front, applying AI to identify patterns and anomalies across large volumes of claims data. Its technology helps insurers proactively spot potential fraud and operational inefficiencies, enabling more informed strategic decisions.
Together, these solutions provide insurers with highly specialized tools that address some of the most persistent pain points in claims operations. Surrounding these high-impact offerings, a broader ecosystem of solutions continues to modernize the entire workflow:
Claimatic improves triage by automating segmentation and assignment, while Appian’s mobile adjuster app supports real-time field assessments to keep claim progress on track. Enservio reduces cycle times for personal property claims by streamlining valuation and replacement.
AI and NLP are also transforming how insurers interact with and understand claim documentation. expert.ai enables deeper insights by parsing structured and unstructured text, while Liberate enhances claimant engagement with AI-powered voice and digital assistants that guide users through the claims journey.
The Power of Insurance Ecosystems in Claims Innovation
The insurance landscape is evolving rapidly, and the ability to quickly adopt and integrate new technologies is critical. Insurers that leverage a connected ecosystem—where AI solutions, automation tools, and predictive analytics are seamlessly integrated—gain a distinct competitive advantage.
The Guidewire Marketplace and ecosystem provide insurers with seamless access to best-in-class claims solutions, eliminating the need for extensive and costly development work. With more than 130 cloud-based applications and partnerships with over 220 technology providers, Guidewire is built to accelerate innovation. By offering pre-integrated solutions, insurers can quickly adopt AI-powered claims technology with minimal customization, allowing them to stay ahead in an increasingly digital landscape.
While AI is revolutionizing the claims journey, its impact doesn't stop there—stay tuned for our next blog, where we explore how AI is reshaping underwriting by enabling faster risk assessment, more accurate pricing, and smarter decision-making from day one.
Want to learn more? Explore the latest AI-powered claims solutions on Guidewire Marketplace today.