ZB Financial Holdings chief executive officer Shepherd Fungura says the insurance industry can take advantage of artificial intelligence (AI) to curb fraud and enhance claims processing.
In fraud claims constitute an estimated 30% to 40% of claims paid annually at around US$165 million.
Insurance fraud involves individuals lying to an insurance company to get financial compensation for something they are not entitled to.
Speaking during the ongoing Insurance Institute of Zimbabwe Annual Conference in Victoria Falls, Fungura said the multi-million-dollar insurance industry would be able to do claim fraud detection and prevention faster with AI as it was more accurate.
“When you get artificial intelligence, it affects the computer and is coded with brain power. So, it’s not a human, but it’s coded enough like it’s a human.
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It can actually, for what it is, be able to repeat certain aspects that it has done before…AI can clean up after you and you can change what the world is,” he said.
“We’re able to do claim fraud detection and prevention because machines are more accurate. And they’re also doing a favour. We can show that this pricing intelligence can be done as fast as it’s coded and we can also give efficiency to claim processing.”
Fungura said the industry could have optimisation because AI was coded making it able to do much better than a humans.
He said the machines were able to know errors and lessen the power cost because as one personalised AI and coded it, it could attain policy orders.
“You can have 200 000 policy orders; it can attain the longest information much faster than a human can. And as well, it can attend to other issues,” Fungura said.
He also noted the potential of blockchain technology, as it has a shared ledger of decentralised networks.
“It can work for industry purposes if you’re trying to do industry fraud management because you’ll be able to see which money was in which insurer, if it was registered, and go to the other. Those are things that blockchain technology can also help us with,” Fungura said.
He added that these types of technologies could also help in the regulatory space to ensure that claims were timeously paid.
Fungura said the technologies were efficient in managing cash flows and that claims were payable.
“That’s very important. So, the legislation is in place. What’s needed is for us to use these technologies to make sure that corporations are able to process these faster. That's the value chain that we looked at. We’ll use blockchain technology. It allocates faster than a human can,” he said.
“It won’t take 30 days for a human to become a fraud, but it’s recessional. You’ll be able to do it quite fast. To allocate much better and more efficiently. You don’t need reconciliation because these are machines.”
By being machines, information would be more accurate.
“You can do this more appropriately. If you look at this, it means there’s less time that is spent on ‘unicorns’ and trying to balance out things that use lower cost to do business,” Fungura said
However, he noted that some of the technology challenges that humans face when using them was power generation.
“So maybe we need to consider how to generate power,” he said.
