Before digital, insurance was personal. The sales mantra that ‘people buy from people’ was widely held to be true. As well as High Street offices, there was an army of financial advisers from a multitude of companies, such as The Prudential, The CIS and the Provident that were invited into the homes of their customers. They got to know the families and their personal and financial history. ‘The Man from the Pru’ was often synonymous with trusted service and products and they offered truly tailored solutions.

This has all changed. For the millennial generation, face to face business is mainly a thing of the past. They expect seamless access to financial products on digital channels …anytime and anywhere. By delivering this 24/7 digital service, there is a danger that the personal relationship is lost. Digital transactions are fine when things are going well and the products on offer fit the need perfectly. But what when things are not going smoothly? Customers still have an emotional relationship with their money and want to feel heard and understood.

How do we retain the personal touch?

Enter chatbots stage left. These ‘conversational agents’ are software applications that can mimic the written or spoken word. They are available via web-based applications and can deliver the 24/7 service demanded in today’s connected world.

Natural language processing (NLP) lies at the heart of chatbot technology. It is the same technology used by voice recognition systems used by virtual assistants such as Google Now, Apple’s Siri, and Microsoft’s Cortana.

Chatbots process text (a process known as “parsing”), before responding according to a complex series of algorithms that interprets the meaning of the enquiry. With the application of Artificial Intelligence (AI), this process has become increasingly sophisticated.


Insurance leading the way

According to the Global Trends Study 2017, the insurance industry is one of the big investors in AI. In an industry that faces many challenges in appealing to its customers, chatbots have been identified as a solution to some of these bigger problems:

  • The right product at the right time. Bots can deliver personalised products and services based on profile data. This helps build real relationships with customers.
  • Chatbots are available 24/7. With a support chatbot that is available at any time, customers can get answers to their questions 24/7. Not only does this help with customers with busy lives, it also eliminates the frustration of international living. Time Zones are no longer an issue.
  • Streamline lengthy processes. Chatbots are already making this dream a reality. Insurance company Lemonade asserts that, as early as 2016, its chatbot Jim settled a claim within 3 seconds. Not every insurance bot will settle every claim that quickly, but undoubtedly insurance wait times and overall process duration will be significantly reduced through the use of AI.
  • Help customers through the complexities of insurance. A chatbot can help customers understand insurance products and processes by using straightforward language and walking new customers through the appropriate process using simple steps.

Chatbots will be able to deliver conversational capabilities that retain the human touch for insurance services. The virtual ‘Man (or Woman) from the Pru.’

There is still a way to go

AI is already impacting every corner of our business and personal lives. Gartner predicts that within two years, a quarter of customer service operations will involve the use of virtual customer assistants.

However, there is still a long way to go as progress in Australia demonstrates. A MuleSoft survey of 1,000 Australian consumers published in July 2018 found that 43% of respondents had engaged with a chatbot when contacting an organisation over the last twelve months. More than a fifth (22%) said the chatbot was unable to resolve or answer their query.

The comment of MuleSoft’s Will Bosma probably sums up the current status of this technology worldwide. “While many organisations are adopting chatbots, improvements need to be made to ensure this new technology is effectively responding to customers.”

Chatbots will become smarter, more responsive, and more useful over the coming years and we’re likely to see more of them. By combining improved ‘conversational agents’ with their digital solutions, Insurers can offer the best of all worlds. 24/7 access with a personal touch.