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Revolution of Emerging Technologies

   

Added on  2021-06-01

4 Pages1243 Words57 Views
Chapter 1: Introduction1.1 Research BackgroundThe insurance and financial services industry is flourishing due to advancement and revolutionof emerging technologies. It has directly provided new opportunities within financial markets tocreate values for business organisations. It has directly helped insurance sector to improve theirprocess management, whereas it has helped financial companies to achieve competitiveadvantage within competitive markets. These advanced technologies are continuouslydeveloping which are helping to make the business processes more accurate and precise. Thesetechnologies are making businesses more intelligent, whereas it is boosting their technicalabilities to innovate their internal processes (Riikkinen et al., 2018).This study mainly focuses to identify the key drivers linked with demand of new technologywithin the insurance sector. Artificial intelligence is an example of emerging technology which isbeing increasingly used in financial sector enabling the companies to make their processessmarter and robust. There are many advantages of AI for insurance industry such as creation ofbusiness models, expansion of insurability, improvement of efficiency, cost reduction, betterengagement with customers, controlling the price risks, and measuring performance (hall, 2019).In today’s world where most of the processes are digitalised, insurance customers are not verysatisfied with this experience. Insurers are lagging behind in using AI to use its full potential toget benefits of better operations and creating value to their business (Deloitte, 2017) However,the industry has started to invest in AI to yield the benefits of this technology in their business.The main insurance business areas that can be benefited from AI are sales and marketing, risk,and operations (Shroff, 2019).According to Keefer (2019), speed of claim settlement has always been a priority of insurancecompanies to retain customer satisfaction. It is very important for an insurance organisation,whether is it small or large to be efficient in all aspects of claims management. However, manyinsurance companies have considered technological advancement to improve their claimmanagement process. The artificial intelligence and machine learning remained the most

prominent technologies which have helped all types of industries. Yet, it is still required toevaluate how artificial intelligence helps in improving the claim management process byinsurance companies. 1.2 Research problemDue to technological advancement, business organisations are mainly relying on the advancedtechnologies to improve their operations, performance, and day to day tasks. The key reasonbehind relying on machines is linked with limitations involved with human handling theoperations. The operations managed by human involve high risks, whereas they are consideredas slower and costly. The advanced technologies can directly helps to improve the operations inall types of industries (Chummun, 2018). However, there have been limited researchesconducted to identify which specific technological advancement is suitable for specificcompanies. The selection of advanced technology mainly depends on different factors such asnature of operations, geographical location, market orientation, and perceived usefulness oftechnology (Dirican, 2015). Similarly, artificial intelligence has completely revolutionised the operations of all types ofindustries (Kumar et al., 2019). Majority of researchers have focused on importance and benefitsof AI for service sector industry such as travel and tourism, disruptive industry, health care, andothers (Wisskirchen et al., 2017). The concept of AI is still developing for specific types ofindustries such as insurance, banking, and other industries. The adoption rate of AI remainedlower within these types of industries due to complexities involved with AI. The concept of AIfor claim management is particularly new for most of insurance companies (Mohapatra andTiwari, 2009). The key reason is that AI adoption requires high investment, whereas only biginsurance companies can afford the AI technologies. This is the reason that researchers have lessfocused on evaluating the benefits of AI for claim management process. Moreover, there islimitation of research which mainly focuses on how AI can expedite the whole claimmanagement process (Kumar et al., 2019).

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