Will robots & AI replace Insurance Underwriters?

As Artificial Intelligence (AI) and automation technologies continue to advance, many professions are grappling with the risk of being replaced.

One such occupation is that of insurance underwriters, who face a staggering 99% chance of being automated.

In this article, we will discuss the role of insurance underwriters and examine the reasons behind their high likelihood of automation.

What Do Insurance Underwriters Do?

Insurance underwriters assess and evaluate the risks associated with insuring individuals and businesses. Their primary responsibilities include:

1. Reviewing insurance applications: Underwriters examine insurance applications, reviewing the applicant’s background, and assessing the risks associated with providing coverage.
2. Determining coverage and premiums: Based on their assessment, underwriters decide whether to offer coverage and, if so, establish the terms and premiums for the insurance policy.
3. Evaluating existing policies: They periodically review existing policies to determine whether any changes to coverage or premiums are necessary.
4. Coordinating with other professionals: Insurance underwriters collaborate with insurance agents, actuaries, and claims adjusters to ensure that policies are accurately priced and cover the appropriate risks.
5. Ensuring regulatory compliance: They ensure that insurance policies adhere to relevant laws and regulations, as well as company guidelines.

Why Are Insurance Underwriters at Risk of Automation?

The high probability of automation for insurance underwriters can be attributed to several factors:

1. AI-driven risk assessment: Advanced AI and machine learning algorithms can analyze vast amounts of data to identify patterns and trends, enabling automated systems to assess risks and determine coverage more efficiently and accurately than humans.
2. Big data and predictive analytics: The integration of big data and predictive analytics in the insurance industry allows for more precise risk assessment and pricing, reducing the need for human input in the underwriting process.
3. Streamlined application processes: The growing adoption of digital platforms and automated application processes in the insurance industry reduces the need for manual review and evaluation by underwriters.
4. Cost savings and increased efficiency: Automating the tasks of insurance underwriters can result in significant cost savings for insurance companies, as well as improved efficiency and reduced error rates.
5. Changing regulatory landscape: As regulatory requirements in the insurance industry evolve, automated systems can be more easily updated to ensure compliance, further reducing the need for human underwriters.

Conclusion

The role of insurance underwriters is highly susceptible to automation due to rapid advancements in AI-driven risk assessment, big data, and predictive analytics.

By adopting automated solutions, insurance companies can benefit from cost savings, increased efficiency, and reduced error rates.

Insurance underwriters should consider acquiring new skills and seeking opportunities in areas that are less likely to be automated, in order to remain relevant in the changing landscape of the insurance industry.

Cristian Gonzalez

I have been using automation tools for many years, now with the advancements of AI and Machine Learning I have been more and more interested in this topic, that's why I started Robotizados a website that helps people be informed about the risks, challenges, and opportunities of Artificial Intelligence.