The significant role of Artificial Intelligence in Banking and Insurance
The part of Artificial Intelligence has taken its vital role in almost all the industries across the world. We are getting used to the well-oriented technology, and we could feel that AI has become inseparable from us. When we see the contribution of AI in the banking and insurance industry, the role is no less. AI has come up with vast improvisation in the banking and insurance industry also.
We will investigate the below points on how slowly AI has acquired its roles in the banking and insurance industry also.
Due to tons of information to be maintained and reacted to it, insurance has taken the help of AI without any choice. There are a lot of claims to be attended to, customer queries to be answered, and a massive amount of data to be kept on record.
A recent study has proved that the Insurance sector invested almost $124 million to make use of AI in the industry, whereas other sectors invested only $70 million. So, with this, we could able to identify the difference in how the insurance sector is using AI in their day to day activities when compared to the other industries.
Price Waterhouse Cooper said “AI’s initial impact primarily relates to improving efficiencies and automating existing customer-facing, underwriting and claims processes. Over time, its impact will be more profound; it will identify, assess, and underwrite emerging risks and identify new revenue sources.”
Below is the various involvement of AI in the insurance sector.
By automating the processes of several claims from the customers, things have become easy for the fast retraction of information from the pre-stored documents. The advantages of AI are,
- Complaints can be filed and attended on a fast track basis. There will not be any delay in answering.
- AI uses patterns of the insurer to file the claims. This prevents if there is any fraudulent claims are in progress.
- Fraudulent can be easily prevented by synchronizing the insurer’s information with all their smart devices. No scams can be reported for this.
Chatbot customer services
In this part of the insurance sector, AI is powered for the chatbot, and it is used as 24/7 customer service. The chatbot can identify the human voice and emotion, and the replies will be given to the customers promptly.
Even the chatbots are fed with language translator, which can be used in any part of the world.
Anti-money laundering (AML) & Know your customer (KYC)
Artificial intelligence (AI) can completely transform how banks perform anti-money laundering (AML) and know-your-customer (KYC) compliance. Additionally, for anti-money laundering, artificial intelligence systems can mine vast volumes of data for risk-relevant facts, simplifying the process of identifying high-risk clients. Fenergo’s CTO, Niall Twomey, discusses.
In the process of KYC, AI plays its role by taking advantage of Natural Language Processing (NLP) technology. This allows the system to read a vast amount of data and helps to scan the documents as soon as possible and feed it in the system. So, for any new customer, the process of KYC has become faster than expected, and the customer experience on registering KYC has been remarkably improved.
In the process of AML, AI prevents any forgery against false document submission and arresting the financial crimes. This is possible by AI when it is connected to all the bank data globally. So, if there is any fraudulent by the customer in any other banks across the world, an alert has been given to KYC, which stops the entire process in banking and can be proceeded further after proper investigation with the customer.
Below are a few advantages of using AI in AML and KYC.
1. Client profile
When AI creates the client profile, the data of the client is well compared and verified with several other links provided by the client. This will make sure that the false profile or fraud profile is not entertained.
2. Beneficial ownership
AI’s participation in KYC & AML sector has reduced the fraudulent profile submission by the clients. This is possible by AI due to feeding massive data about almost all the humans in the nation. AI has taken significant beneficial ownership in reducing all the risks in the banking and insurance sector.
3. AML investigations
AML’s screening and investigation technology will allow the system to send alert information across all the linked systems if any discrepancy of details of the client is identified. This will stop all the processes further, and with the proper investigation with the client, the next steps will proceed.
4. New client
The scanning of any external documents has become very efficient due to AI. The data feeding to the system has become fast, and it started giving a positive aspect to the client about the concern where the client is trying to onboard.
Money laundering prevention
When the data of all the clients are fed in the system, the role of AI starts by maintaining the massive record of all the clients. This will have the below advantage against fraudulent.
1. The risks of money laundering have come to zero. Manual identifications of money laundering are not possible nowadays, so AI started playing a vital role in such cases. Any false message or document submitted by the client will be alerted to all the systems across the world, and the further processes are kept on hold until the verification is cleared. The clients
are forced to submit the actual documents to avoid any fraudulent cases.
2. The fast track process of the system will allow the client to be more satisfied with the concern, and also, the client will feel safer on their personal data storage.
The conclusion is, in this super fast world, the usage of AI in the insurance and banking sector has become a member of the industry to fast process every process safely.