Impact of Machine Learning and AI in an Insurance Organization

This paper explores the impact of machine learning and AI in a motor vehicle insurance organization, including customer journey mapping, information architecture, technology architecture, project governance, and cost-benefit analysis.

Running head: IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Impact of machine learning and AI in motor vehicle insurance industry
Name of the Student
Name of the University
Author Note

IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION 1
Executive Summary
The incorporation of the machine learning techniques and artificial intelligence can be very
much useful in a motor vehicle insurance organization. All the usage-based insurances can be
covered up well using AI technology. This paper will be having numerous segments, it will
be introducing with the detailed description of the customer journey mapping. The following
section will highlight the Information Architecture and the Technology Architecture with
proper justifications. The steps of project governance and the selected project management
methodology will be discussed in the paper as well. The feasibility of the plan will be
provided in this business report in terms of the time frame of each of the sub-activities, work
break down structure and the work package decomposition. A list of recommendations will
be concluding this business report.

2IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Table of Contents
Introduction................................................................................................................................3
Customer journey.......................................................................................................................3
Information Architecture............................................................................................................5
Justification............................................................................................................................6
Technology architecture.............................................................................................................6
Justification............................................................................................................................6
Governance and methodologies.................................................................................................7
Justification............................................................................................................................7
Cost Benefit Analysis.................................................................................................................8
Time frame of the project...........................................................................................................9
Work Breakdown Structure......................................................................................................10
work package decomposition...................................................................................................10
Recommendation:....................................................................................................................12
Conclusion:..............................................................................................................................13
References................................................................................................................................14

3IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Introduction
The notable determination of the paper is to focus on the role of machine learning and
artificial intelligence in a major motor vehicle insurance organization from the perspective of
an ICT specialist. The needs and expectations of the consumers of this industry keep on
changing due to the wide application of the disruptive technologies (Jha et al. 2018). It can be
said that the incorporation of the machine learning techniques and artificial intelligence can
help this insurance organization to enhance their business reach and attract most of the
potential clients of the organization.
Customer journey
The customer journey map can be very much useful before the incorporation of AI
and machine learning techniques in this major insurance organization both the internal
stakeholders of this organization such as the top-level management team as well as for the
external stakeholders of this organization such as the consumers who needs and requirements
are always changing during to the enactment of numerous disruptive technologies by most of
the major insurance organizations (Kelley et al. 2018). The gap between the channels and the
different categories of departments of this organization can be successfully minimized using
the customer journey map (Hengstler, Enkel and Duelli 2016). The improvement initiative of
this organization can also be enhanced using this mapping technique. The expectations of the
customers can also be known using customer journey mapping (Kumar 2018). The
experience of the consumers of this organization which can be capitalized in the future
ventures can also be decided using the customer journey mapping (Hanna 2017). The
complaints of the customers of this organization can be addressed using the customer journey
map as well, thus it can be said that the customer retention policy of this organization can be
maintained using the3 customer journey map.

4IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Figure 1: Customer Journey Mapping (CJM) of this major insurance organization
(Source: Created by the author)
The following steps can be very much useful for creating the CJM in this major motor
vehicle insurance organization.
Steps Details Explanation
Step 1 Define the persona The needs and expectation of consumers have to be
identified in the first place.
Step 2 Define customer
phases
Phases such as scoping, mapping out customer expectation,
improvement and maintenance is very much vital for the
consumer journey mapping.
Step 3 Touch point for the
consumers
Insurance details, pre-sales support, facilities during the
insurance packages can be useful to maintain the branding
of this business.
Step 4 Research Development of the employees working in this
Identify gap
between
channel and
department
Improve
customer
retention
Experience
of the
consumers
can be used
for the well-
fare of this
organization.
Enhance
improvemen
t initiative

5IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
organization must be aligned with the organizational target.
Step 5 Determine point of
friction
Overheads cost of the organization needs to be minimized
and customer experience must be enhanced.
Step 6 Resolve The journey of the customers must be smooth so that the
business growth of this organization is maintained.
Table 1: CJM of this major insurance organization for the consumers
(Source: Created by the author)
Information Architecture
The detailed description of an Information Architecture will be presented in this unit
of the paper.
Insurance organization
Upcoming products Search option Log out
Dashboard options
Services Customer
experience and
coverage
personalization
Claims
settlement
issues
Bench mark
AI solutions
Account
Management
and Policy
renewal
Training and
report
Premium
pricing of
the service
using AI
technology.
Chatbots based
on AI
technology can
be resolved all
the issues of
the clients
after verifying
identity.
Customer
satisfaction
can be
enhanced
after a claim
is officially
filed.
Product and
service
evaluation
can be done
by the
consumers
of this
organization.
The account
of the
admins as
well as the
consumers
can be
managed
using the AI
technology.
Education
details for the
future
employees in
terms of the
job
opportunities
can be
notified to
the registered
account
holders.
Policy
details
About Us page Payment
option
Complaints
section
Contact Us
page
History of the
organization
Table 2: Information Architecture for the organization
(Source: Created by the author)

6IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Justification
This information architecture can be very much useful for both the internal
stakeholders of this insurance organization to understand the impact of the machine learning
and AI technology (Lee, Lee and Kim 2019). All the latest coverage can be easily understood
by the clients of this motor vehicle insurance organization using the above Information
Architecture. The technology architecture will be presented in the ensuing section of the
paper.
Technology architecture
This unit of the paper will be discussing the desired technology architecture for this
motor vehicle insurance organization.
Figure 2: Technology architecture for the vehicle motor insurance organization
(Source: Created by the author)
Policies and
Principles
Each of the motor
vehicles have separate
insurance packages.
Policies keeps on
updating.
Current services
and IT trends
Chat bot and executivr
team will be helpful to
deak with the
consumer complaints
AI technology is used
in the organization
portal
Business
requirements
and department
direction
Business decision can
be taken by the
machine learning
techniques.
Future services and
production can be
managed internally by
the admins of the
organization.

7IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Justification
The proposed technology architecture can be very much beneficial for this
organization as it describes the interaction and the structure of the services offered by this
motor-vehicle insurance organization (Nakamura et al. 2019). All the business units of this
corporation can be managed using this architecture. The project governance procedures, as
well as the project management methodology which will be selected in this project, will be
discussed briefly in the following sections of this report.
Governance and methodologies
Professional project governance plan can be very much important regarding the
incorporation of the artificial intelligence in the working environment of this organization.
Phases Explanation
Phase 1 The configuration of the AI technology must be compatible with the existing
technologies used in the organization.
Phase 2 Business data should be carefully migrated from one end of the organization
to another.
Phase 3 The usage and the support required must be gathered from the employees of
this organization.
Phase 4 Orientation training and skill development training can be very much
important regarding the successful implementation of the AI technology.
Phase 5 The outcome of the incorporation procedure of AI technology must be
matched with the deliverables of the project.
Table 3: Project governance plan for the organization
(Source: Created by the author)
Justification
This project governance plan can be very much essential for this organization as it can
successfully help in identifying the issues which can be faced during the incorporation
procedure of the AI technology.
Waterfall project management methodologies can be very much important for the
implementation of the AI technology in this motor vehicle organization. Each phase of the

8IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
project can be professionally monitored using the waterfall project management methodology
(Shalini, Krishnamurthy and Narasimha 2017). This project management methodology can be
understood by both the consumers as well as the employees of this organization which is the
initial reason behind selecting this methodology (Agrawal, Gans and Goldfarb 2019). The
changing expectations of the consumers of this organization can be purposefully aligned
using this project management methodology (Stilgoe 2018). The cost benefit analysis of this
project will be presented using a pictorial diagram.
Cost Benefit Analysis
RMO Cost/Benefit Analysis for the implementation of AI in motor vehicle insurance organization
Incorporation of AI technology 60000
Additional cost 15000
Total Cost for the project 75000
Year of Project
year 0 year1 year 2 year 3 year 4 year 5 TOTALS
Net economic benefit $0.00 $35,000.00 $35,000.00 $35,000.00 $35,000.00 $35,000.00
Discount Rate 8% 1 0.9259 0.8573 0.7938 0.7350 0.6806
PV Of Benefits $0.00 $32,407.41 $30,006.86 $27,784.13 $25,726.04 $23,820.41
NPV of all BENEFITS $0.00 $32,407.41 $62,414.27 $90,198.39 $115,924.44 $139,744.85 $440,689.36
One Time Costs $75,000.00
RecurringCosts $0.00 $100.00 $100.00 $100.00 $100.00 $100.00
Discount Rate 8% 1.0000 0.9259 0.8573 0.7938 0.7350 0.6806
PV Of RecurringCosts $0.00 $92.59 $85.73 $79.38 $73.50 $68.06
NPV Of All Costs $75,000.00 $75,092.59 $75,178.33 $75,257.71 $75,331.21 $75,399.27 $451,259.11
Overall NPV ($10,569.75)
Overall ROI = (Overall NPV / NPV Of All Costs -0.02
Total Cost for theproject
Figure 3: CBA for incorporating AI technology in an insurance organization
(Source: Created by the author)

9IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Overall NPV ($10,569.75)
Overall ROI = (Overall NPV / NPV Of All Costs -0.02
Break-Even Analysis
Yearly NPV Cash Flow $0.00 $32,314.81 $29,921.12 $27,704.75 $25,652.54 $23,752.35
Overall NPV Cash Flow $75,000.00 ($42,685.19) ($12,764.06) $14,940.68 $40,593.23 $64,345.58
Project break-even occurs between years 2 and 3
Use 1st year of positive cash flow to calculate break-even fraction 2.4607 years
Figure 4: Break even for incorporating AI technology in a motor vehicle insurance
organization
(Source: Created by the author)
Time frame of the project
The detailed description of each of the activities of this project will be presented in
the below pictorial diagram.
ID Task
Mode
Task Name Duration Start Finish
1 Implementation of AI
in insurance
organization
56days Wed5/1/19 Wed7/17/19
2 Phase 1 10days Wed5/1/19 Tue 5/14/19
3 Selection of
technology
2days Wed 5/1/19 Thu 5/2/19
4 Literature Review 2days Fri 5/3/19 Mon 5/6/19
5 Documentation 5days Tue 5/7/19 Mon 5/13/19
6 Evaluation 1day Tue 5/14/19 Tue 5/14/19
7 Phase 2 11days Tue 5/7/19 Tue 5/21/19
8 Understanding
business
requirements
5days Tue 5/7/19 Mon 5/13/19
9 Evalyating
customer issues
1day Tue 5/14/19 Tue 5/14/19
10 Understand the
opportunity of AI
5days Wed 5/15/19 Tue 5/21/19
11 Phase 3 5days Wed5/22/19 Tue 5/28/19
12 Design the system 5days Wed 5/22/19 Tue 5/28/19
13 Phase 4 36days Wed5/29/19 Wed7/17/19
14 Incorporation
phase
30days Wed 5/29/19 Tue 7/9/19
15 Understand the
limitation of AI
5days Wed 7/10/19 Tue 7/16/19
16 Training for staff 1day Wed 7/17/19 Wed 7/17/19
28 2 6 10 14 18 22 26 30 3 7 11 15 19 23 27 1 5 9 13
Apr 22, '19 May 6, '19 May 20, '19 Jun 3, '19 Jun 17, '19 Jul 1, '19 Jul 15, '19
Figure 5: Time frame for incorporating AI technology in an insurance organization
(Source: Created by the author)

10IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
Work Breakdown Structure
The following pictorial diagrams will be stating each of the sub categories of the four
phases of implementation.
Implementation of AI in
insurance organization
Phase 1
Selection of
technology
Literature Review
Documentation
Evaluation
Phase 2
Understanding
business
requirements
Evalyating customer
issues
Understand the
opportunity of AI
Phase 3
Design the system
Phase 4
Incorporation phase
Understand the
limitation of AI
Training for staff
Figure 6: Phase wise WBS
(Source: Created by the author)
Work package decomposition
The following table can be very much helpful for the readers of this document to have
an idea about each of the phases of incorporating Artificial Intelligence and machine learning
techniques in the business environment of motor vehicle insurance organization.
Implementation of AI in a motor vehicle insurance organization
Phase 1 Phase 2 Phase 3 Phase 4
The selection of the
machine learning
procedures and
artificial intelligence
is considered in this
The needs and
expectations of the
consumers of the
organization has to
be aligned with the
Designing of the
system will be
considered in this
phase of the project
(Brynjolfsson, Rock
This is the most
important phase
among the rest of the
phases. The
implementation of

11IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
phase of the project.
Detailed analysis of
the AI will be done
by the internal
stakeholders of the
organization in this
phase. All
assumptions and
deliverable are note
in a formal
document.
incorporation
procedure of AI
technology. The
future opportunities
has to be considered
during the
implementation of
the AI technology.
and Syverson 2018). the AI technology
will be considered in
this phase
Table 5: Work package decomposition for this project
(Source: Created by the author)
Critical Success Factors for the Project
There are different categories of Critical Success Factors which are needed to be
considered during the enactment of the Artificial Technology in the working environment of
this major motor vehicle insurance organization (Felten, Raj and Seamans 2019). These
critical factors will be discussed in this section of the paper.
Different types of Critical Success Factors Explanation
Prioritizing engineering The deployment of the software must be
known to both the internal along with the
external stakeholders of this motor vehicle
insurance organization so that the business
inconsistencies are easily resolved.
Financial capability Support from the investors as well as from
the top-level management is very much
desired during the incorporation of the AI
technology in this motor vehicle insurance
organization (Takacs et al. 2018).
Training Service training, orientation training, on-
board training and e-training facilities is
very much significant regarding the
enactment of the AI technology in this
motor vehicle insurance organization.
LPM principles The risk associated with the project has to
be considered before the design phase of
this project (Frey and Osborne 2017).
Communication Communication between the consumers and
the employees of this organization can play
a huge role in the implementation of AI

12IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
technology in this insurance organization
(Hanna and Kimmel 2017.).
Leadership The role of the organizational leaders are
very much important regarding the
implementation of these emerging
technologies.
Organization culture A sense of acceptance must be there for
each of the stakeholders of this
organization, maintaining a professional
work culture will be important regarding the
implementation of the AI technology in this
organization.
Table 6: CSF which has to be considered in this project
(Source: Created by the author)
Impact of the implementation on the organization
Change management strategy must be selected in such a way so that it does not have
any effect on the existing process of this organization. Change management strategy such as
the redefining the cultural value, exercising authority and shifting the burden of change
should be focused during the enactment of the machine learning as well as the Artificial
Intelligence Technology. These change management strategies cab be very much beneficial
to deal with issue such as internal resistances.
These above discussed change manage strategies can be very much important during
the enactment of these technologies in this major insurance organization. The basic elements
of the change management strategy should be considered during the enactment procedure so
that it does not affects the other technologies which are already been used in this industry.
Recommendation
The recommendation of this project will be discussed in this section of the paper.

13IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
 The new technology should not be having any issues with the technologies which are
already been used in the business environment of this major motor vehicle insurance
organization.
 All the business process and business data should be protected from any sort of data
security issues such as data alteration and data manipulation, as it would be a huge
financial and reputations loss for this organization.
 The risks of the implementation procedure and the knowledge gaps among the
employees of the incorporating technology must be addressed with the help of risk
management plan and skill development training respectively.
 IT governance plan should be considered during the implementation of this plan, at
the same time it can also be said that the waterfall project management methodology
can be very much beneficial in this project.
 Selection of professional human resources is very much recommended in this project
as they can manage each if the difficulties in an organized and structured manner.
Resources should be understanding the value creation ability of this new emerging
technology. The limitations, as well as the benefits of Artificial Intelligence and
machine learning procedures, must be known to each of the stakeholders of the
business.
 The ethical considerations of Artificial Intelligence has to be focussed before the start
of the project.
Conclusion:
The paper is very much helpful for the readers of this document to understand the
importance of customer journey mapping in a major insurance organization. The detailed
explanation of the CJM can be understood from the tabular description of the paper. The
paper has highlighted the desired Information architecture and the Technology architecture

14IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
along with justification. The desired project governance plan of this project can also be
understood from the paper. The paper also presents the cost-benefit analysis of the project
along with the break-even occurrence. The timeframe of each of the activities of the project
has been presented in the form of gnat charts and work breakdown structure. Critical success
factors which are needed to be incorporated during this project such as communication,
leadership, organization, culture and training can also be determined from this paper. Thus,
the feasibility of incorporating Artificial Intelligence in an insurance organization can be
understood from the paper.

15IMPACT OF MACHINE LEARNING AND AI IN AN INSURANCE ORGANIZATION
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