Insurance companies have been much slower to adopt AI compared to other industries. Nevertheless, we have already seen more and more applications of AI such as replying customer’s enquiry with chatbots, pricing a policy based on data, and handling claims procedures. Still, when it comes to selling insurance, one of the most intriguing questions is: Will AI replace insurance agents?
It doesn’t seem likely that AI will replace insurance agents anytime soon. At its core, selling insurance requires human touch – building relationships, paying attention, being empathetic, and caring about feelings, these qualities will never be replaced by AI.
In this article, I will first look at what insurance agents have to offer to add value for customers. Then I will examine whether or not these skills can be replaced by AI – be it a machine, program, system or a chatbot.
4 Reasons why AI will not replace insurance agents
Buying insurance can be a complicated process. And the job of an insurance agent is to match the right product to the right people. An insurance agent typically interacts with a customer throughout the sales cycle – from providing quotes, explaining the coverage, to filing a claim and so on.
Now let’s take a closer look at what insurance agents have to offer and examine why the skills required cannot be replaced by AI.
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1.Identifying customer’s need
How do insurance agents add value?
Insurance agents access their client’s needs by asking questions about their personal circumstances. They understand different types of insurance and how they work.
They suggest the right kind of coverage that protects their customers’ lives or properties in case of potential loss.
Why are insurance agents better than AI?
Amazon incorporates AI to suggest products based on your preferences and what other people also buy. Their AI makes sure you always have more choices than you intended to search for.
But when you are shopping insurance, more than often you may not even know what kind of risks you are exposed to. How can you search for something you don’t know?
Moreover, your insurance needs may vary as your circumstances change over time. And everybody’s circumstances are different. There is no one-size-fits all when it comes to buying insurance.
Will AI replace insurance agents?
AI is proven to be better than humans in certain areas, such as processing large amounts of data, making precise calculations or repetitive tedious jobs. However, machines are unable to recognize the context of any scenario.
Identifying customer’s protection needs requires understanding, prediction, and experience. These skills, at least for now, cannot be programmed or learnt by AI. Thus, the answer is no.
2. Finding the right products
How do insurance agents add value?
Insurance agents can get you quotes. And independent agents/insurance brokers (who have access to products from different carriers) will often get you a good deal by comparing prices and product features across different carriers.
They are knowledgeable to help their clients to customize or negotiate suitable coverage to best suit their customer’s needs.
Why are insurance agents better than AI?
Today, insurance comparison websites open 24/7. Their AI is able to quote much faster than humans. These insurance comparison websites have tons of data to get you quotes within minutes. But the outputs are mainly based on price.
Unlike humans, these websites are not able to tell you why pricing differences exist relative to quality of coverages, particulars of coverage, and/or differences in claim service.
Will AI replace insurance agents?
Determining the best coverage goes far beyond the price – it requires logical reasoning by a human. Sometimes conflicts need to be resolved by weighing between the pros and cons. Lawyers and judges do apply these skills in their domain too.
Qualitative skills like this will not be replaced by machines.
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3. Taking care of claims
How do insurance agents add value?
If you need to make a claim, your insurance agent will help you gather necessary supporting information and work with their claims department. They can save you from worry especially when you are sick or have to deal with loss of property or loved ones.
Why are insurance agents better than AI?
Insurance agents get their business by building relationships with their customers.
They are caring, empathetic and pay attending to details. These feelings that are unique to humans and cannot be executed by AI.
Will AI replace insurance agents?
Some insurance companies are using AI to automate certain parts of the claims handling process to speed up the processing time. This can improve customer service for sure.
Explaining claims to clients, however, maybe a bit more complicated. It may trigger or evolve emotions. Machines are yet to recognize emotion at this stage.
Hence, jobs that deal with human and require empathy like insurance agents, physicians, nurses, or therapists are unlikely to be replaced soon.
4. Servicing the policy and beyond
How insurance agents add value?
People’s circumstances change overtime. They change jobs, they buy new vehicles, they move to new houses, they may get sick and they age.
Insurance agents answer questions about their client’s existing coverage. They are able to evaluate their insurance policies and tell them whether they are getting the suitable coverage.
Why are insurance agents better than AI?
True. Chatbots are available 24/7. They can give basic directions, check billing information, verify transactions, and reply to anything that is based upon the data it already has access to. But they cannot feel.
Do people really want to learn about their coverage on their health or loved ones from a cold machine? I doubt it.
Some people avoid talking about insurance because they think it is too complicated or they don’t need it. This is where insurance agents come into play. They build rapport, they tell stories, they show they care and they give advice as a human.
Will AI replace insurance agents?
Servicing requires a great deal of human touch. At the end of the day, you want to talk to a human about someone or something you care about. You want to be heard and you want to be understood. AI can’t feel your feelings. So the answer for this one is an obvious no.
Final thought: Work with AI to stay future proof
As consumer’s expectations are constantly changing by their experiences with other industries, insurance agents will need to work with AI hand-in-hand to provide a better customer experience to stay competitive.
AI can help insurance agents to gain detailed insights into customers’ demographics, behaviour, interests, shopping habits, and other information. This information can be used by the agent to engage customers in their context. This creates more opportunities for them to pitch their sales in a more personalized and accurate manner. What’s more is that with AI, it can be done at scale with speed.
Selling insurance (especially for life insurance and health insurance) involves emotions. It entails relationship-building, trust-building and social interactions. Not until AI can learn how to feel and care, insurance agents are here to stay.
