How AI and Big Data Are Transforming the Insurance Industry

. Improved Risk Assessment Historically, insurers set premiums through historical data. Big data offers them the chance to look at real-time data concerning the lifestyle, driving habits, or health behaviour of a particular individual. For instance, telematics data allows car insurance to track the manner in which someone drives. Thereby, it offers UBI models where lower premium rates are ascertained for safer drivers.

2. Detection of Fraud Insurance fraud results in billions of losses to the industry every year. Big data with AI can help identify unusual patterns of claims, which may lead to fraudulent activities. For example, AI may identify unusual claims or trace the social activity of the customer on social media and then point out the inconsistencies in reports around incidents.