AI opens the door to faster home insurance claims

  • AI is disrupting the insurance industry by enabling faster, more user-friendly claims and creating more transparent and personalized policies that suit the customer’s situation
  • AI Property has proven itself during the 2021 typhoon season in Japan, resolving claims for MS&AD Insurance policyholders impacted by Typhoon Mindulle as quickly as a single day
  • Insurance technology replaces the traditionally time-consuming and tedious process of obtaining a claim or settling a one-size-fits-all property insurance policy

Insurance technology brings more innovative solutions for owners and insurers through artificial intelligence (AI).

AI is disrupting the industry by enabling faster, more user-friendly claims and creating more transparent and personalized policies that suit the customer’s situation. This replaces the traditionally long and painful process of getting a claim or settling for a one-size-fits-all property insurance policy.

AI is disrupting the insurance business

Tractable’s AI Property, for example, gives anyone with a smartphone quick and efficient access to building damage caused by hurricanes, floods and other natural disasters.

Use its mobile-friendly web app to take photos of external conditions and submit them to Tractable’s AI platform, trained on an extensive database of claims and damaged goods. The amount of damage is immediately assessed and forwarded to the owner’s insurer. It is not necessary to call an appraiser to come on site.

“Climate change is leading to more frequent and severe natural disasters. Hurricanes leave households without adequate housing. By enabling homeowners to immediately self-assess their homes via AI-augmented damage assessment, insurers can intervene faster and at greater scale, to help their customers when they need it most,” said Alex Dalyac, co-founder and CEO of Tractable, which has been developing AI systems for visual assessment and disaster recovery since 2014.

AI Shows Courage During Japan’s 2021 Typhoon Season

AI Property has already proven itself during the 2021 typhoon season in Japan, resolving claims for policyholders of MS&AD Insurance Group Holding Inc – affected by Typhoon Mindulle last October – as quickly as a single day. The traditional disaster relief claims process could take months.

Currently, MS&AD only uses AI for widespread disasters, such as typhoons, with AI-generated estimates being verified by humans. It also continues to work with Tractable to expand AI coverage to include interior damage, such as water leaks and smoke, in the future.

First insurance technology stack for multi-family properties

Meanwhile, fast-growing digital insurance provider Honeycomb has developed its AI-powered technology as a first tech stack for multi-family properties and the first to instantly offer tailor-made insurance coverage “at the right price”. This is a welcome innovation for owners and condominium and homeowner associations struggling with complicated and time-consuming insurance processes.

“Commercial lines insurance and in particular multi-family property insurance is ripe for disruption given the sheer complexity of underwriting this class of risk, its legacy of manual processing and the lack of a market leader,” said Itai Ben-Zaken, co-founder and CEO of Honeycomb, which has offices in Denver, San Francisco and Tel Aviv.

“At Honeycomb, we have successfully translated the institutional insights of our team of industry veterans into algorithms that analyze in-depth, first-party, location-specific data to more accurately assess risk. As a result, we can perform more robust underwriting faster and at a lower cost structure than before.

New solution streamlining customer and broker experience

Its new solution streamlines the experience for clients and brokers by leveraging its unique underwriting technology that accurately “prices” each individual risk and offers discounts that no other provider provides. It also allows it to offer tailor-made insurance coverage that can be adapted to the needs of the client.

For example, it can insure properties with Airbnb rentals while providing enhanced coverage for ordinances and laws, separate coverages for business income and additional expenses, and a tailored approach to deductibles in at-risk areas.

Policyholders who follow Honeycomb’s mitigation guidelines and requests also earn greater discounts over time, encouraging positive self-selection. Those who take care of their properties get better prices.

Honeycomb’s brokers can deliver up to 30 binding quotes per hour in real time, thanks to its proprietary algorithms and first-party data. The process of producing a single quote typically took weeks with multiple “touches” and follow-ups, so the dramatic reduction in time means more profit for brokers.

While insurtech hasn’t been in the spotlight as much as fintech, with results like those from startups like Tractable and Honeycomb above, disruption to the insurance industry seems like a win-win situation for customers and insurers.