How AI and ML are Transforming the Insurance Industry
To offer competitive rates, the insurance industry needs predictability. This is why insurers are increasingly turning to AI and machine learning to more easily predict the future and the risks that the future may hold for their clients. For example, AI can help insurance companies gain enough information about changing weather patterns to keep premiums low, by analyzing historical weather data and future weather predictions. Another example is the price of behavior policies. Instead of tailoring a policy based on information provided by a customer in the app, policies can be tailored using personalized data from devices like vehicles and fitness trackers. This leads to personalized pricing, meaning safer drivers and those leading healthier lifestyles will be offered reduced premiums for car insurance and health or life insurance, respectively. Essentially, AI allows insurance companies to rely on near real-time event-based predictions using large data sets, rather than a statist...