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How AI is Affecting the Insurance Industry to Improve CX

How AI is Affecting the Insurance Industry

AI has been making major waves recently, and for good reason. It’s got the potential to help optimize all kinds of workflows and run businesses more efficiently.

But what does its impact on the insurance industry look like, and how does it affect CX in particular?

We’ll explore this question, along with others, below. First, however, we’ll start things off with a quick definition.

What is CX?

Short for ‘customer experience’, CX describes the entirety of a customer’s thoughts and feelings as they interact with your brand. It’s all about the impression you leave on the people who shop with you, as well as the processes they go through with your company.

Why is CX so important?

As mentioned above, anything contributing to a customer’s idea of your brand counts as part of CX. This alone is reason enough to put effort towards it, though some other standout factors also make it important. Let’s go through some of them:

Helping customers feel valued

Your customers need to know that you care about them if you want to keep them coming back. That’s particularly true in the insurance industry, where customers don’t often see a direct reward for choosing a particular provider.

A retail company can, for example, send out free samples or offer discount codes to thank their customers. That’s not the case for insurance companies, which is why happy customers that feel seen and heard are so vital in this sector.

Excellent CX lets you show them that you care in a very direct way. Let’s sat that a customer is looking for a remote desktop for Mac download on your website, and they find both what they need and a lot of useful information right away—they’re likely to think of you positively and come back.

Building lasting customer relationships

On top of customers returning to a place where they had good experiences, good CX lets you create customer relationships that really last.

This means that the new customers you gain aren’t there just for the short haul. Instead, they’ll stick with you for a long time, potentially even for life, if the experience you offer is pleasant enough. This means better ROI on any resources you put towards customer acquisition and/or conversions.

Boosting your brand’s reputation

When your customers can only give glowing reviews of your company and the experience it offers, your brand’s reputation improves. It also spreads faster this way, securing you new leads and helping your business grow sustainably.

That’s especially important in an industry like insurance, which isn’t as immediately attractive to most people as something like food or fashion.

A good reputation can also help you impress shareholders and retain existing customers.

Why use AI in the insurance industry?

Before we can get into the intricacies surrounding the optimal AI customer experience, we’ll take a step back and think about the top reasons why you might choose to use AI in the first place. As above, we’ll be thinking of this within the wider context of the insurance industry.


AI can be counted on to always behave the way it’s coded to, with no room for unpredictability. That’s why it’s very good at answering preset questions; it simply detects relevant keywords, then gives the same reliable answer every time.

For example, you might train your chosen AI to recognize keywords like ‘act of God insurance’ in the context of a question. This would then prompt it to give an explanation of the term to the customer asking, and this explanation would always be consistent and accurate.

In short, AI can always be relied upon to do its job exactly how it’s supposed to.


When claims are made or plans need to be updated, insurance professionals have to work fast. That’s much easier when they’ve got a dedicated AI to support them.

We’ll look at another example. Let’s say you’re searching for available domain names for your company’s websites, but you don’t have time to spend trawling through suggestions that might not be appropriate. You can prompt your AI to create a list for you using suitable keywords.

This cuts down the amount of time you’d need to spend to secure an excellent domain name.


As evidenced in the number of virtual assistant AI examples you can find on the market today, there are plenty of AIs out there, with options available for anyone’s needs.

That’s particularly valuable in the context of insurance. After all, each insurance company has its own approach to crafting a great experience for its customers, so their chosen AI should be able to support those approaches.

Processing capacity

Another major advantage of AI is the fact that it’s able to do a lot at once, saving you further time and helping you complete more tasks each day.

As an example, an AI-powered call center will be able to process more calls in a set amount of time than one run without AI. That’s because AIs help manage call queues, direct customers to the right experts, answer basic questions to keep customers out of queues, and much more.

And they do it all in record time, too. That power to handle many things at once is incredibly valuable to insurance professionals.

How does AI improve CX in the Insurance Industry?

It’s now time to consider the practical applications of AI, with a particular focus on its capacity for improving CX. We’ll be looking specifically at use cases for AI that work well within the insurance industry to better illustrate how you can start using AI to your advantage.


Chatbots are powered by AI trained using machine learning models. These AIs can carry on conversations that sound and feel natural, helping form meaningful connections with customers.

An AI-based chatbot can talk about all kinds of basic topics with your customers, from safety tips to insurance premiums and well beyond. This makes it something like a constant companion to customers that’s always ready to answer their questions at any stage.


A modernized business is better equipped to handle the needs and demands of modern customers. Accordingly, it’s important to create a strong application modernization strategy for your company that lets you optimize every last piece of tech you use.

And AI should be a cornerstone of that tech.

Being one of the most important ‘hot topics’ at the moment, AI is a relatively new and powerful type of tech. That’s why it’s being incorporated into all kinds of cutting-edge tools and solutions for businesses, which means you should always look to include it in your own tech stack.

Data collection

One of the biggest points in favor of AIs is that they help companies gather large quantities of data very easily.

This is particularly useful for insurance companies, who usually offer more than one type of service; from car insurance to pet insurance, customer needs will vary, meaning that there are many opportunities for data collection. And customer data can be a treasure trove of insights, if you use it right. 

For example, you could collect data on the factors that push leads to becoming customers. You could also gather information on what your customers like or dislike about their experiences with your company, so you can make targeted improvements.

In addition, AI’s role extends to optimizing various operational aspects, including accounts receivable management, streamlining payment tracking, and processing across multiple accounts. This multifaceted application of AI ensures the accuracy and efficiency of financial operations while simultaneously elevating the overall customer experience.

Sales and conversions

The best sales enablement tools tend to have some kind of AI involvement, and for good reason. It’s simply much easier to work productively with lots of customers when you’ve got an automated tool backing you up.

This means, in practice, that AIs help your company make more sales.

It also helps that, as mentioned, AIs can gather information on leads. Your agents can then use that data to inform their approach, tailoring their tactics to the needs and preferences of every customer they communicate with. This makes for a more personalized experience, which helps encourage customers to choose you.

Analytics for company growth

The value of data really can’t be understated. In addition to using it for optimizing the way you handle customers, you can also use it to guide your company’s overall growth.

And a company that’s focused on CX throughout the process of growing is a company that can sustainably direct its focus to its customers.

AI lets you both gather this information and process it into actionable insights. That saves you time and effort while ensuring any major decisions you make are based on facts and observable evidence, rather than conjecture or gut feelings.

Final thoughts

From the looks of things, AI is here to stay.

It’s made its initial impact already, but that doesn’t mean it won’t continue to transform most industries. That’s why it’s well worth it to stay ahead of the trend and embrace the change. AI is indispensable to the future of CX, including within the insurance industry. 

It has already positively affected the way in which insurance companies handle and analyze data, connect with customers, and drive sales. This valuable tool is not only rapidly becoming indispensable to industry professionals, it has changed the business landscape; that’s why so many have invested in this tech.

Updated: December 2023

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