Insurance companies now have access to conversational AI, which can be used for a host of different tasks, from automating conversations with policyholders and partners to building automated workflows. But what are the pros and cons, and how can insurers determine if it’s the right fit for their needs?
The Basics of Conversational AI
Conversational AI platforms for insurance serve multiple functions, both externally and internally. Externally, they can act as the first line of customer service, handling policyholder inquiries, processing claims, and guiding users through self-service options. Advanced AI engines can simulate human-like conversations, resolve routine issues, and escalate complex cases to human representatives when needed.
Insurers use conversational AI to streamline internal workflows and operations – automating underwriting queries, assisting agents with policy recommendations, and accelerating document processing. These tools can also function as dynamic knowledge bases, enabling employees to retrieve policy details, compliance guidelines, or training resources instantly.
The Pros of Conversational AI for the Insurance Industry
There are many advantages to using conversational AI in the insurance industry:
High Efficiency
Conversational AI is a highly efficient tool, especially when it comes to costs.
This technology is relatively inexpensive, yet it can do the work of hundreds of people, in many cases, much faster than those people could do it.
Time Savings
Insurance companies love conversational AI for its ability to save time. Instead of spending hours on a task, or having one of your employees spend hours on a task, conversational AI can take care of it in minutes. At scale, this can save thousands of man-hours, which you can then spend on more important matters.
24/7 Availability
Most customers expect a lightning-fast response time. When they have questions about a policy or when they have to make a claim, they want immediate and full attention.
Waiting on hold even for a few minutes may annoy them. Conversational AI allows you to offer your customers 24/7 availability without having to hire a 24/7 team of human employees. You can almost guarantee an instantaneous response to every customer when you use conversational AI as well.
Easy Training
Conversational AI makes internal training much easier. Instead of forcing your experienced employees to do the work, and instead of spending hours going over the material, employees can engage with a conversational AI and learn at their own pace.
No Language Barriers
Another advantage of conversational AI is that it can translate on the fly.
You won’t need to hire polylingual customer service agents, but you’ll be able to handle inquiries from almost anyone.
Precise Answers
With proper preparation, conversational AI can give extremely precise, concise answers to customers. Even with the best training, human customer service agents can struggle with this.
Suitability for Any Volume
If you have a finite customer service team, there’s a strict upper limit to the number of queries you can handle without massive backups. But conversational AI is hypothetically infinitely scalable; it works well for small numbers of queries, but also for much bigger volumes.
Cost Savings
Conversational AI solutions are capable of saving you a lot of money.
There are people you’ll no longer need to hire, tools you’ll no longer need to pay for, and customer service costs that you can eliminate or reduce as a result of using it.
Data and Insights
Finally, you can use conversational AI to gather and analyze data about your customers – and how they use this type of tool. The more you learn about your customers, the better you’ll be able to serve them.
The Cons of Conversational AI for the Insurance Industry
However, there are some drawbacks to using conversational AI in the insurance industry:
Difficulty with complex queries.
Conversational AI can’t handle everything. When it comes to more complex or challenging queries, it might need to hand things off to a human representative.
Lack of human connection.
Effective customer service isn’t just about providing answers to questions or solutions to problems; it’s also about human connection.
Although great conversational AI tools can replicate the nuances of human conversation, they can’t convincingly replicate much empathy or bonding.
Dependency on model speed and quality.
Much of your success in using conversational AI depends on the speed and quality of the model you’re using. Not all conversational AI tools are equally valuable.
Potential data limitations.
Most conversational AI is limited in terms of the data and information available to it.
Conversational AI is a powerful tool, but it works best as part of a hybrid approach – enhancing efficiency while keeping humans in the loop for complex interactions. Insurers must continuously refine AI models and strike the right balance between automation and personalized service.
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