Page 34 - The Insurance Times May 2025

Innovative AI

How Innovative AI

and Machine Learning

are set to redefine the

future of the Insurance

Aditya Dadia
Sector Founder Alwrite

Artificial Intelligence and Machine Learning (AI and ML) are two of the most critical technologies
at the forefront of the digital revolution. Both aim to provide feasible solutions to legacy issues in
different sectors. The insurance sector has already introduced technologies to improve operational
performance and resolve longstanding challenges.

A rtificial Intelligence and Machine Learning (AI detection, and intricate claims processing. Due to the nature
and ML) are two of the most critical technolo-
of commercial insurance, legacy systems have relied heavily
gies at the forefront of the digital revolution.
on manual underwriting, often leading to delayed policy ap-
Both aim to provide feasible solutions to legacy
issues in different sectors. The insurance sector has already provals, inefficient claims handling, and high operational costs.
Commercial insurers have also suffered from fraudulent
introduced technologies to improve operational perfor- claims, which have resulted in huge financial losses.
mance and resolve longstanding challenges. For instance,
Indian insurance companies lose $6.25 billion to different With the introduction of AI and ML in commercial insurance
types of fraud, approximately 8.5% of their total revenues. processes, it is possible to automate underwriting, enable
predictive risk modeling, and improve fraud detection. Data
AI and ML can help fix loopholes by reshaping traditional Analytics powered by AI can assess risks effectively, and ML
processes, making them more efficient, data-driven, and algorithms can streamline claim processing and underline
customer-centric. In addition to risk assessment and fraud any unusual patterns in such claims. The advancements
detection, the usage of the latest technologies can enable make the entire process faster and more reliable.
insurers to deliver personalized policies and proactive risk
management. Key Areas Where AI and ML Are Rede-

fining Commercial Insurance
The Role of AI and ML in Commercial
Here are the core areas where AI and ML have already been
Insurance introduced and have redefined commercial insurance:

The operations and processes in commercial insurance are 1. Underwriting and Risk Assessment: Commercial
inherently complex and include detailed risk assessments, fraud insurance's underwriting process has traditionally de-

32 May 2025 The Insurance Times