Contribution of AI in the Growth of Cyber Insurance
Cyber insurance is still in the developing stage. Insurance companies are undergoing a digital revolution. However, with the contribution of AI in the growth of cyber insurance, the insurer can connect to the applicants more efficiently. The application of AI has reduced the errors made by humans. In addition, the technologies have increased the customer channel in the insurance industry.
Let us discuss some key contributions of AI in the growth of cyber insurance.
Cyber attacks are increasing exponentially due to the adaptation of technologies. Further, the outbreak of the Covid-19 pandemic has changed the timeline. This has compelled the insurer to apply AI technology in order to measure the risk and claim.
Assessment of Risk
Humans may make errors while assessing the involvement of risk. Earlier, the insurer or insurance underwriters were compelled to rely on the information provided by the claimant. They were expected to interpret that information in order to assess the risk. However, the claimant or applicant might not be honest and may render inaccurate risks.
It is important for the insurance company to assess the risk with more accuracy in order to decide the appropriate premium. Therefore, the insurance company is required to eliminate the traditional means or methods for measuring the risk. Instead, they must embrace AI in order to determine the risks and premiums.
Detection of Fraud
AI is a significant watchdog in order to detect fraud. Fraud is the most significant factor to understand for the cyber security insurance companies. An individual is required to detect the pattern on which the fraud is based. He might need to apply a research study in order to detect fraud. However, nothing can escape from AI.
The AI may easily interpret the patterns of claims and detect if fraud has been committed by the claimant. The AI may read or learn the algorithm and reach the most accurate result. It may readily find out suspicious or fraudulent claims. Therefore, insurance companies must incorporate AI in order to determine fraud.
Reduce Human Errors
A series of humans are involved in examining the soundness of a claim. It comprises several manual works. In addition, it slows the process and incurred a considerable cost to the insurer. On top of that, the process needs the incorporation of manpower in order to determine the claim.
Therefore, the complexity of the process is prone to risk. Nevertheless, the algorithm of AI may reduce errors and time. It generates accurate results. Therefore, the incorporation of AI may reduce human risk and produce appropriate results.
The contribution of AI to the growth of the cyber insurance industry is notable. It provides accuracy in order to interpret the risk and premium. Further, the insurer may also incorporate it into customer services. Many cyber insurance companies have installed chat bots on their website in order to provide clarification to the customer about insurance policies.