Transforming Underwriting with AI: Evolving Risk Assessment and Policy Pricing in P&C Insurance
DOI:
https://doi.org/10.63282/3050-9416.IJAIBDCMS-V4I3P110Keywords:
AI in insurance, underwriting automation, policy pricing, risk assessment, P&C insurance, machine learning, predictive analytics, insurtechAbstract
Artificial Intelligence (AI) is changing the world of industries and the world of Property and Casualty (P&C) insurance cannot be an exception. The traditional underwriting is associated with a significant increase in the provided practices with AI-powered models functioning on the basis of large amounts of data, real-time analysis, and forecast modeling. The paper will discuss the ways and manner in which AI has transformed and is changing P&C underwriting, i.e. in relation to how it has impacted the P&C underwriting space in terms of its contribution to risk assessment and policy pricing. The paper explores the trends that have led to these revolutions and gives a wholesome view of the AI proceedings, such as machine learning, natural language processing and computer vision, that automate the underwriting processes. Additionally, it also features case studies of insurance companies which have already introduced AI and showed how the technology succeeded in making results more accurate, operations highly efficient, and customer satisfaction high. The questions related to data privacy, discrimination on algorithms, and respecting regulations are also taken into consideration. The paper puts forward a concept on how artificial intelligence can delightfully and reasonably be applicable in underwriting with the way this revolution is destined to run. In the paper, the researcher will quantitatively and qualitatively assess the performance of AI throughout the underwriting and conclude with recommendations that may be put in place to guide the insurers who are faced with this technological change in their implementation of AI
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