How A.I. can help brokers deal with their carriers

Brokers are excited about the potential of artificial intelligence (A.I.) to help streamline interactions—not just between brokers and consumers, but also between brokerages and insurance companies.

Chatbots are often cited as an A.I. tool to help brokerages automate and streamline their online interactions with clients. But chatbots can also act as “advisors” internally at brokerages, helping brokers to figure out the different insurance company manuals, data collection rules and processes.

“We have lots of companies with different rules,” says Amanda Ketelaars, operations manager at Mitchell & Whale Insurance Brokers Ltd., which has already started using a chatbot to streamline interactions with consumers.

“We think there is lots of learning A.I. and chatbots can do around managing the different [company] rules and helping us to straighten those things out. That makes it easier [for the broker] to find a lot of [company] information that we now have to enter manually. I think it can be an internal advisor as much as an external advisor.”

Rick Orr, owner of Orr Insurance & Investment, believes A.I. will save insurers “a fortune,” by automating processes between brokerages and insurers.

“I think you’ll just use A.I. to load the  [company] manual into the system and let the brokers chat [with the insurers] and get an answer back,” he says. “You will end up with way fewer, higher-level underwriters dealing with true exceptions to what the book says, the way it should be.”

For now, much of the hype around A.I. is the possibility of improving broker relationships with clients. The Insurance Institute of Canada recently released a trends paper on A.I. in the Canadian p&c industry, in which sources talk about increasingly sophisticated chatbots becoming “robo-advisors” in the future.

For example, PwC predicts robo-advisors will soon offer broker clients more ‘recommender’ systems and ‘someone like you’ statistical matching, the paper says. “When fully mature, robo-advisors will understand individual and household balance sheets and income statements [and they] will be able to recommend, monitor and change financial goals and portfolios for their p&c policyholders.”

The genesis for robo-advisors already exists today in the form of chatbots. But the current experience with chatbots suggests regulatory hurdles to achieving the utopian vision of robo-advisors.

“There are restrictions around licensing and what [a chatbot] can tell [consumers] and what it can’t,” Ketelaars says of the Mitchell & Whale’s chatbot experience.

“But it can automate simple tasks, answering repetitive or straightforward questions like, ‘Where do I find your office? Where would I get a quote?’ or ‘I need to speak to a broker about this.’ It can collect all the information before it gets to the broker. The chatbot can do quoting, until we get to a bind stage and then the person can speak to a broker at the end of that phase.”

The Insurance Institute paper notes some barriers to A.I. use among brokers in Canada. “Barriers to AI use in Canada include high investment costs, which could be prohibitive to small insurers and brokerages, as well as a general lack of trust in allowing machines to handle personal interactions with humans.”

But Ketelaars thinks brokers can defray their costs by working with partner insurance companies and insurtechs already working in the A.I. space. Mitchell & Whale, for example, partnered with ProNav Technologies, an Ontario-based insurance tech company, to develop its chatbot.

EDITOR’S NOTE: A previous version of this story paraphrased Rick Orr as saying that brokers could save a fortune with A.I. Rick Orr intended to say insurers could save a fortune. CU regrets the error.