Can AI help you grow your business?

By John Forcucci

Over the past couple of months, ChatGPT has been the hot topic. Artificial intelligence has been making its way into the insurance business for years. How, might you ask? Well, I asked OpenAI’s ChatGPT this question. Its response follows.

ChatGPT:

AI is becoming an increasingly important technology in the insurance industry. Here are some ways in which AI is being used.

1. Risk assessment and underwriting: AI algorithms can analyze large volumes of data to assess risk and determine the appropriate level of coverage for a given policyholder. This can include data from public sources, such as weather patterns or crime statistics, as well as data provided by the policyholder, such as medical history or driving record.

2. Claims processing: AI can help insurers automate the claims process, which can reduce costs and improve efficiency. For example, AI algorithms can analyze images of damage to a vehicle or property to determine the extent of the damage and estimate repair costs.

3. Fraud detection: AI can help insurers detect fraudulent claims by analyzing patterns in data and identifying inconsistencies. This can help reduce losses due to fraud and improve the overall accuracy of the claims process.

4. Customer service: AI-powered chatbots and virtual assistants can help insurers provide personalized service to policyholders, answering questions and providing information about policies and coverage options.

5. Predictive analytics: AI can help insurers analyze data to identify patterns and make predictions about future events. For example, AI algorithms can analyze weather patterns to predict the likelihood of natural disasters or analyze driving patterns to predict the likelihood of accidents.

Overall, AI is helping insurers improve efficiency, reduce costs and provide better service to policyholders. As the technology continues to evolve, we can expect to see even more innovative uses of AI in the insurance industry.

Not too shabby. So I guess you could say that AI has become part of the foundation of the insurance business. What it can accomplish all sounds pretty lofty, though, and it’s the kind of back-end, under-the-hood processing that has little day-to-day meaning for the average agent or small agency.

The answer that it gave me about AI’s role in insurance provides a big clue, though, as to how it already has become an integrated tool for many small agencies and practices. Its major use — so far — appears to be marketing. ChatGPT and its competitors can be very helpful with many daily marketing and social media tasks, including topic ideas for your editorial calendar, content briefs and outlines for those articles, FAQs, email copy (including subject lines) and personalization, social media captions, help with search engine optimization — and more.

What’s a bit dicier, though, is whether these tools can write authoritative and expert content.

For one thing, the data these AI monsters draw from is vast but not unlimited. ChatGPT, for example, does not include the most recent data and content on the internet; its knowledge base ends in 2021. And while it can pull together relatively general information, like the summary of AI’s role in the insurance industry, it can struggle mightily with nuance and complex information that requires expert knowledge — which includes a lot of insurance and financial services information.

In this month’s issue, we talk to many in the industry who are using AI, often to their benefit.

Nearly all those we spoke to, though, warned that AI does make mistakes, often including incorrect information — sometimes making things up entirely — and missing key nuances. And even the more mundane uses of AI require oversight, fact-checking and careful review.

What is clear, though, is that we are still at the beginning of this path, and without a doubt, AI will quickly and continuously improve.

One person we interviewed said that he couldn’t ignore AI for his business because not using it would mean his competitors were apt to get a leg up on him. As true as that may be today, it’s for sure going to be even more the case tomorrow. If you don’t embrace AI, it may well leave you behind.

Welcome to Finseca

As part of our continuing effort to expand the number of professional associations providing useful information and discussion for our readers, we welcome Finseca this month to the pages of our magazine. Their first article, found on page 46, “SECURE 2.0 provides new opportunities for advisors,” explains that while clients of all ages can benefit from the provisions of the bill, they require the help of advisors to fully take advantage of its benefits. Finseca represents, serves and advocates for the financial security profession. Its members provide life insurance and retirement planning solutions. Welcome to Finseca!

John Forcucci
Editor-in-chief