How Insurers Leverage Machine Learning Processes

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Artificial intelligence

It’s no secret that the auto insurance industry is one of the largest users of big data analytics. Insurance markets live and die on their data practices, and the more efficiently they collect and process data, the greater the insights they get and better business decisions they can make.

Machine learning has all but eliminated the use of human intervention in data management and manipulation. Insurance companies use machine learning technology to enhance security, assess risk, and much more. Continue reading to learn some of the ways insurance companies make use of machine learning solutions.

Artificial intelligence enables companies to automate data collection and processing.

Artificial intelligence

Financial institutions need and use big data more than most other industries with insurance companies likely being chief among them. Insurers compile enormous amounts of data, a vast majority of which they fail to process and utilize.

There’s a persistent myth that we only use about 10% to 15% of our brain, and while the myth isn’t true, it is analogous to how efficiently insurance companies utilize their data. Machine learning enables auto insurance companies to make much more and better use of their data with the power of artificial intelligence, eliminating the need for human intervention.

Comprehensive car insurance policies have many varying pricing models which are based on the types of policies and the driver history of applicants. Business users and data stewards can create algorithms that power machine learning to extract data from multiple data sources, from social media to search engines, and process it via automation. Machine learning even enables machines to recognize and adjust to data patterns without human interference.

Machine learning algorithms provide actionable insights, such as risk assessment.

Risk assessment is one of the most important factors in crafting insurance policies with fair premiums and deductibles. It’s also one of the most common uses for insurance companies and lenders alike who use machine learning to gain insights into customer behavior to inform their decision-making.

Unsupervised learning enables insurance companies to pull unstructured data from unplanned and untapped data sources for the development of creative analytics models. There isn’t much data that insurance companies and other finance companies miss with unsupervised learning technology.

Deep learning technology provides an added layer of security for policyholders.

Insurance companies use sensitive data for everything from screening applicants to handling insurance claims, and you can’t begin to conceive of the volume of bad actors online who would love to steal your information. Data security is of the utmost importance to insurance companies and other financial institutions, and that’s why one of the most promising machine learning uses is deep learning technology.

Deep learning machines employ security measures such as speech recognition, face recognition, and fingerprinting to provide bio-cybersecurity. As a trailblazer in data science, TIBCO strives to deliver deep learning tools that allow business users and consumers to communicate with machines using natural language. As you can see, deep learning not only enhances security but also improves the customer experience.

Machine learning artificial intelligence enables insurance companies to process real-time data.

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Of the best things about machine learning technology is that it enables machines to process real-time data in real-time, meaning it captures and processes up-to-the-minute data in one seamless stroke. Some of the top auto insurance providers offer machine-learning plugins to policyholders that collect and report driving data to the insurance company.

These plugin machines collect data such as average speed, how drivers turn corners, and even how much pressure they apply to their brakes. This data can be used to offer safe-driver discounts or raise insurance premiums for unsafe drivers.

As you know, the car insurance industry is one of the most data-intensive industries there is. It’s always depended on large amounts of data, but now machine learning enables them to maximize their data processing and analysis. With machine learning and artificial intelligence, auto insurance companies perform in-depth risk assessments, process real-time data in real-time, and improve the customer experience for policyholders. It should be exciting to see how insurance companies will use data science next.