Can AI save shippers from supply chain problems? | Insurance business America
New findings from Gallagher Bassett show the answer is yes, in part due to better claims processing
Insurance News
By Bennett Richardson
Due to the cumulative impact of disruptions on claims management processes, supply chain challenges continue to be a key concern for carriers.
A new survey from Gallagher Bassett, released as part of The Carrier Perspective: 2024 Claims Insights report, shows that 62% of carriers worldwide reported challenges managing end-to-end claims management in 2023 due to global supply chain issues, with 56 % of these reported disruptions in claims settlement in North America.
“Global supply chain challenges, including rising inflation, geopolitical tensions and energy prices, have significantly impacted carriers’ ability to promptly resolve claims. These challenges have disrupted the supply chain and created delays and complications in the claims processing process,” said Joe Berrios, Managing Director – Carrier Practice at Gallagher Bassett.
Berrios believes the impact supply chain disruptions are having on claims processing underscores the need for innovative solutions. Luckily there is one at hand.
A significant advance with AI
Improved digital capabilities, including generative AI solutions, are proving to be a timely and valuable tool to address the problem.
“Integrating AI into the workforce is expected to bring significant benefits across the insurance sector, including end-to-end visibility into claims processing,” Berrios said.
“Implementing AI tools offers numerous opportunities to improve operational efficiency across various carrier domains; Gallagher Bassett is currently exploring use cases that will enable our employees to spend more time delivering exceptional service to our customers.”
AI is already impacting many parts of the insurance value chain. Gallagher Bassett’s survey shows that by 2023, a clear majority of 57% of carriers in North America were using AI in customer service, with 40% already using it for claims processing.
Strategies to address these issues can still be improved in North America
The adoption of AI in claims processing and other areas by some forward-thinking companies is not surprising given the impact that supply chain pressures are having on efficient claims management.
Still, there is room for improvement in strategies to address supply chain disruptions in North America compared to the rest of the world.
While carriers around the world are addressing the problem to varying degrees, implementation of solutions in North America generally lags behind. Carriers here are implementing digital claims processing at a rate of 47% compared to 54% globally. Likewise, 31% of shippers in North America have taken action to strengthen or repair their supply chain networks, compared to 34% globally.
“In North America, less than half of carriers surveyed prioritize technology solutions (47%), which is well below the global average,” said Joe Powell, senior vice president of analytics at Gallagher Bassett.
North American airlines are also less focused on implementing cost-saving measures (47% vs. 53%) and diversifying their supplier base (37% vs. 44%) than globally.
“The balanced focus on introducing cost-effective measures and integrating technological solutions suggests a regionally cautious approach to technology investments,” Berrios said.
When implementing AI solutions, the benefits outweigh the concerns
Of course, there are concerns about AI solutions and their potential impact on insurance company processes – and just some of them concern whether AI could outsmart us and become irrelevant.
In the early stages of implementing a new technology, there are always concerns about how it will work alongside existing systems and traditional methods.
The top concern for 41% of North American operators is how to seamlessly integrate AI into business operations. Managing data privacy and security (23%) when implementing AI is the next big concern, while 20% of operators have concerns about ensuring compliance.
“It is critical to the future of the industry to address concerns about AI integration and establish best practices in daily operations,” said Berrios.
“To safely capitalize on the opportunities AI brings to claims processing, a tailored approach to facilitating AI must focus on privacy and usability. With our private and secure general-purpose AI model, Gallagher Bassett aims to optimize the potential benefits of AI while addressing specific business needs and challenges.”
This includes prototyping AI applications in specific areas, including litigation management and resolution, first notice of loss (FNOL), risk signature searching, claims assignment, investigation, and refining existing waypoint models through increased usage unstructured data.
To this end, Gallagher Bassett has a dedicated cross-functional team that focuses exclusively on carriers’ individual goals and objectives.
“We strive to build an integrated claims management program that is aligned and tailored to each client’s specific business objectives and internal operations.”
This approach also takes into account the human side of the equation. As more people become familiar with using AI, the need for a human “pilot” will become better understood. This is particularly true for complex claims.
“People need to understand the nuanced and sometimes subjective aspects of a claim. Furthermore, data interpretation requires more than just algorithms. It takes human intervention to uncover hidden patterns, identify contextual factors and practice critical thinking,” Berrios said.
One thing is certain: AI will surprise the insurance world, and working with an experienced claims professional at the forefront of the changes taking place will be critical.
“As the insurance sector continues to grow and transform, resilience, agility and a forward-thinking mindset will be key to success in the coming year and beyond. The ability to quickly adapt, anticipate market trends and improve digital capabilities will be more important than ever for network operators to position themselves as industry leaders in the coming years,” said Berrios.
“By remaining proactive and adaptable, carriers can navigate these changes and position themselves for success in the evolving industry.”
Gallagher Bassett (UK) is North America’s leading provider of claims and risk management solutions to insurance carriers. GB is committed to providing solutions that reduce risk, improve efficiency and deliver outstanding results.
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2024-04-09 05:41:02
www.insurancebusinessmag.com
