Car insurance claims estimated before the tow truck is called?

By using algorithms, tech companies are helping insurers speed up the claims process after an accident, making it more accurate and keep estimators out of the field — a plus during a pandemic.

On a typical day, significant numbers of UK drivers have accidents serious enough to warrant calling their insurers. After the initial shock comes a predictable sequence of worries: Was anyone hurt? Am I at fault?

The driver’s first call is often to the insurance company, which leads to the next questions: How long will it take to get an estimate, get my car into the body shop and get it back on the road?

The time it takes to settle vehicle insurance claims is reducing, and the accuracy of initial estimates is improving, because increasing numbers of UK insurers now use artificial intelligence to generate repair estimates. This technology, powered by AI, is very different from the “virtual claim” you might have previously filed.

The accuracy of initial estimates is improving, because increasing numbers of UK insurers now use AI to generate repair estimates

About five years ago, photo-based estimates became increasingly common with insurance companies having customers download an app that helped them provide consistent photos, but many just told customers to attach pictures to an email.

Insurance companies like photo-based estimates because engineers, who can average only four in-person estimates a day, can complete as many as 15 virtual ones by staying in the office and scrolling through customer-supplied photos on a computer. Once damaged cars get into body shops, those estimates prove to be far less accurate than those done in person. Insurance companies were bedeviled by costs that surpassed estimates — called claim supplements — sometimes running as much as 50 percent higher. Customers were frustrated by unexpected delays. And body shops hated being caught in the middle.

That was then. Now, customers can download phone apps through their insurers to guide them through the process of taking and uploading photos that can be evaluated by AI, producing near-instantaneous damage estimates. The apps are already starting to be used in the United States.

The algorithms are trained in image classification, with the best already providing estimates in a few seconds that are as accurate as those produced by experienced human estimators. The pandemic too has made AI -powered estimating even more attractive because the technology reduces or even eliminates the need for face-to-face interaction between drivers and insurance adjusters.

By eliminating the need to make appointments with appraisers or make a separate trip to the body shop for an initial estimate, these apps take days off the “cycle time” — how long it takes to get customers back into their cars. Algorithms also learn and adapt more quickly than human experts. A simple bumper replacement is not necessarily simple anymore, because new bumpers often have expensive integrated sensors, like the ones that warn drivers if they’re backing up too close to another car when parallel parking. As a result, those claim supplements are increasing.

In the USA the software has already fed its algorithm about 10 million photos of damaged cars, most of which were taken in body shops and submitted to insurers along with repair estimates.

The rise of AI could be bad news for thousands of people working at insurance companies at the suggestion that the technology will necessarily put people out of work. One expert concludes that “The goal of this technology is to take care of the repetitive, straightforward cases so that our experts can focus on the complex ones, or on providing better customer service,, because sometimes when you’ve had an accident, you’re pretty shaken and want that human touch.”

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