Page 42 - The Insurance Times August 2025

How AI is

Reshaping the

Insurance

Landscape in India Ramya Vellingiri

Principal Architect (Marvel.Ai),
KGISL Technologies Private Ltd

Insurance fraud poses a perennial challenge in India's large and diverse market, costing billions
annually. Indian insurers are deploying AI-based fraud detection systems that flag anomalies using
behavioral patterns to reduce fraudulent payouts. AI combats this issue by analyzing vast datasets
using machine learning algorithms to detect anomalies indicative of fraudulent activity.

T he Indian insurance industry is undergoing a pro- ing up policy issuance. They can also dynamically adjust pre-

miums based on individual behavior and health indicators,
found transformation.and Artificial Intelligence
(AI) is at the heart of this revolution. Tradition-
promoting fairer pricing.
ally driven by paperwork, manual processes, and
long turnaround times, the sector is now embracing auto- Crucially, AI-driven alternative data models are expanding
mation, personalization, and predictive intelligence at scale. access to insurance for previously underserved segments of
the population. This has been a game-changer for sectors
With a population of over 1.4 billion and rising digital adop-
tion, India presents a fertile ground for AI-driven innovation like health and motor insurance, where real-time insights
in insurance. lead to more accurate pricing and broader coverage, fos-
tering greater financial inclusion across India.
According to insights from a recent RegTech report, AI is
fueling the growth of the Indian insurance market, projected Claims Automation
to reach $222 billion by 2026. This growth stems from en- Claims processing, traditionally resource-intensive, has been
hanced pricing, underwriting, and promotional strategies, transformed by AI. Machine learning and natural language
along with advancements in customer service and person- processing (NLP) automate tasks like damage assessment
alized offerings. and fraud detection, delivering real-time results. AI-pow-
ered image recognition assesses damages instantly, elimi-
Smart Underwriting and Risk Assessment nating the need for physical inspections. These innovations
The Indian insurance landscape is rapidly moving beyond accelerate claim settlements, reduce operational costs, and
generalized risk categories. AI models are now analyzing enhance customer trust.
vast datasets.including credit histories, social media activ-
ity, wearable health data, and local weather patterns.to pro- For high-volume claims in the healthcare sector, AI not only
vide highly personalized, real-time risk assessments. enhances operational efficiency but also significantly reduces
the turnaround time for claims settlement by automating
Indian insurers are strategically leveraging AI to automate health claims processing workflows. This ensures faster settle-
underwriting decisions within minutes, dramatically speed- ments, improved accuracy, and better service delivery.

38 August 2025 The Insurance Times