From customer service chatbots to serving up the right mix of trip-specific benefits to the right consumer, technology using artificial intelligence (AI) is making its way into the travel insurance sector, and insurers are beginning to invest time and money to harness its power.

Compared with other forms of insurance, travel policies lend themselves particularly well to AI for several reasons.

For one, said Chris Carnicelli, CEO of Generali Global Assistance, it's high volume. Travel insurance often requires more interaction with customers than other kinds of insurance when travel-disrupting events, such as hurricanes, occur.

AI can help speed interactions with customers by enabling a computer to answer simple requests or assist customers with things like filing claims, he said.

Using forms of AI and big data to configure insurance offers for customers is also particularly useful in travel insurance, according to Mike Nelson, CEO of Allianz Global Assistance.

Nelson said the average policy price is below $100, depending on the channel, and unlike other, bigger-ticket forms of insurance, such as auto or homeowners, choosing a policy tends to be a fairly quick decision. Allianz prepares about 2 billion travel insurance quotes each year.

"We're getting a lot of data, and there are a lot of different benefit configurations we could offer to that traveler," Nelson said.

Using AI to configure benefits is a boon to the insurer as well as to travelers, who get the most appropriate policy for their needs.

Allianz is using machine learning and predictive analytics to configure policies sold through partners, from travel agents to OTAs to suppliers.

"Because of all these relationships we have, because of the amount of quotes we do, we get a lot of data, and that's where we've invested most of our resources," Nelson said.

AIG Travel, too, is looking at applying AI to packaging benefits for consumers, said Jeff Rutledge, president and CEO. To that end, the insurer has begun refiling insurance policies throughout the country so the benefits are less packaged than in the past.

"That allows someone to be able to choose something very specific, such as just trip cancellation or security evacuation, and create a package that's specifically tailored for them, unlike that sort of bundled package that's normally used," Rutledge said.

Generali already dynamically prices, according to Carnicelli, but he predicted that pricing will improve as machine learning advances further.

Chatbots for customer service are also popping up as a valid use case for AI with regard to travel insurance. AIG is testing one in China on the WeChat application, and Allianz and Generali are also testing chatbots.

"Right now, we're implementing it for the relatively simple questions and claims," Carnicelli said. "The difficulty is that travel insurance has myriad different circumstances where somebody could have a claim or require an intervention, and we can increase the levels at which machines can handle things quickly and rapidly for customers as the technology evolves."

The challenge lies in finding the right balance between chatbot and human interaction with customers.

"It's a tough balance," Carnicelli said, "but I think we're all learning."


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