Artificial intelligence implementation to improve the claims process is likely to become significant in the local insurance industry within the next five years, IAG executive manager analytics and AI Willem Paling says. 

Mr Paling says AI advancements in claims will be led by overseas markets, such as Europe, the US and northeast Asia, with Australia to follow the international trends. 

“You’ll see it happening elsewhere before you see it happening here, but five years is a pretty reasonable timeframe,” he told the Claims Convention in Sydney on Thursday. 

Mr Paling says training AI to analyse data and descriptions about events to efficiently allocate policyholder claims to the right motor or home repairers offers significant opportunities for resolving claims more rapidly. 

“If we do this right more often, we minimise the cost of the claim, we minimise the inconvenience to the customer, our industry runs much smoother and it’s a better outcome for everyone,” he said.  

Mr Paling says many tasks in insurance claims take place within specific domains where technology has shown it can perform more effectively than people. That includes pattern recognition where computers are better at using historical knowledge to predict future outcomes. 

Other examples include the recognition of objects in images, which has assisted in fraud detection, while capabilities in voice and language are being harnessed. The technology is also generating high quality responses in a wide range of technical fields. 

“AI is a change on the scale of the internet and mobile phones,” Mr Paling said. “We need to be open to it because in more and more cases every year AI can do a better more consistent, faster more reliable job for our customers and help all of us to build a better industry.” 

The Claims Convention was presented by the Australasian Institute of Chartered Loss Adjusters and the Australian and New Zealand Institute of Insurance and Finance.